FTC blocks Microsoft’s $69bn Activision Blizzard acquisition deal

The Federal Trade Commission (FTC) asked a court to temporarily block Microsoft’s acquisition of Activision Blizzard, seeking to halt the deal from closing before the government’s case against the $69bn deal is heard. The FTC said Microsoft and Activision had signaled the deal could close as soon as Friday, and asked a federal judge to block any final agreement before 15 June.

The FTC said the deal, which would be the largest for Microsoft and the biggest in the history of the video game industry, would give Microsoft the “ability and increased incentive to withhold or degrade Activision’s content in ways that substantially lessen competition”.

The FTC said without action by a judge the combined firm “could alter Activision’s operations and business plans”, and could allow the software giant to access sensitive business information.

The FTC, which enforces antitrust law, had already asked an in-house administrative judge to block the transaction on antitrust grounds in early December, arguing it would give Microsoft’s Xbox exclusive access to Activision games, leaving Nintendo consoles and Sony’s PlayStation out in the cold.

Microsoft’s bid to acquire the Call of Duty maker in a $69bn deal was approved by the EU in May, but British competition authorities blocked the takeover in April.

“We welcome the opportunity to present our case in federal court,” said Microsoft President Brad Smith in a statement. Activision did not comment.

Microsoft has said the deal would benefit gamers and gaming companies alike and offered to sign a legally binding consent decree with the FTC to provide Call of Duty games to rivals including Sony for a decade. When announcing the deal in January 2022, Microsoft said it expected it would close in its 2023 fiscal year, which ends in June.

In light of that, and public reporting that Microsoft and Activision Blizzard are considering closing their deal imminently, we have filed a request for a temporary restraining order to prevent them from closing while the review continues.

FTC spokeswoman

The case reflects the muscular approach to antitrust enforcement taken by Joe Biden’s administration. But antitrust experts say the FTC faces an uphill battle to convince a judge to block the deal because of the voluntary concessions offered by Microsoft to allay fears it could dominate the gaming market.

A trial at the FTC’s in-house administrative court is scheduled to begin on 2 August.