FTC rift signals fresh hope for Microsoft’s acquisition of Activision-Blizzard in America

The board is expected to make its recommendations regarding the deal by mid-December

FTC rift signals fresh hope for Microsoft’s acquisition of Activision-Blizzard in America

Microsoft’s ongoing efforts to acquire Activision Blizzard has been one of the biggest developing stories of 2022, not just in the mobile space but in the wider games industry as a whole. Although the deal has been approved in several territories, other regions have launched investigations into the acquisition to address concerns about how it could affect the market.

A new report from the New York Post states that a growing rift on the Federal Trade Commission (FTC) could allow the stalled Microsoft-Activision-Blizzard deal to progress, as at least one democrat on the four-person panel has come around on the merger, joining Republican commissioner Christine Wilson in support of the deal.

The Post reports that this puts FTC Chair Lina Khan in a difficult position. Khan has previously pushed for the FTC to block the merger from progressing, with Politico reporting last month that a lawsuit was likely as the FTC staff are “skeptical of the companies’ arguments.”

Should these reports prove accurate, it would mean a 2-2 split in a vote on whether to let the merger proceed, something DC insiders say that Khan is keen to avoid.

“Lina would probably not put things in a position for that to take place, so instead of having that vote she would make the motion to approve the settlement,” said former FTC chairman William Kovacic. “The way out is to say, ‘We got a great deal and only got it because we’ve been badasses.'”

Although the FTC’s approval isn’t necessary for the deal to be closed, it can impose additional barriers on Microsoft’s actions in America, something the company is no doubt keen to avoid.

Why has the deal faced issues?

The acquisition has faced significant pushback from legislators and competitors, in particular due to the possibility that the popular Call of Duty franchise would become exclusive to Xbox consoles. Although Microsoft has so far refused to offer a binding promise to maintain the franchise’s presence on PlayStation consoles,

Reuters reported last week that Microsoft is likely to offer Sony a ten-year licensing deal to address concerns of a possible monopoly.

“As we have said before, we are prepared to address the concerns of regulators, including the FTC, and Sony to ensure the deal closes with confidence,” stated a spokesperson for Microsoft. “We’ll still trail Sony and Tencent in the market after the deal closes, and together Activision and Xbox will benefit gamers and developers and make the industry more competitive.”

The FTC is expected to make a recommendation regarding the acquisition by mid-December. Before then, Microsoft can meet with individual FTC commissioners to press its case.

Earlier this year, we listed Activision Blizzard as one of the top 50 mobile game makers of 2022.

Staff Writer

Lewis Rees is a journalist, author, and escape room enthusiast based in South Wales. He got his degree in Film and Video from the University of Glamorgan. He's been a gamer all his life.