The US Federal Trade Commission (FTC) has moved to block Microsoft’s takeover of video game company Activision Blizzard, citing concerns that the deal would thwart competition by denying rivals access to popular gaming content.
Microsoft, which owns the Xbox video game console system, said in January 2022 that it would buy Activision for $68.7bn, which would make it the biggest gaming industry deal in history. Activision is the maker of popular games including Call of Duty and World of Warcraft.
The FTC voted 3-1 on Thursday to issue its complaint after a closed-door meeting, with the three Democratic commissioners voting in favor and the sole Republican voting against.
The US agency, which enforces consumer protection and antitrust laws, said the merger could suppress competitors to its Xbox game consoles and its growing games subscription business.
The agency said that Microsoft had a record of buying valuable gaming content and using it to stifle threats from rival consoles. The deal had also raised concerns with the UK’s competition regulator, which said it “could substantially lessen competition in gaming consoles, multi-game subscription services, and cloud gaming services”.
“Microsoft has already shown that it can and will withhold content from its gaming rivals,” said Holly Vedova, director of the FTC’s bureau of competition. “Today we seek to stop Microsoft from gaining control over a leading independent game studio and using it to harm competition in multiple dynamic and fast-growing gaming markets.”
Microsoft president Brad Smith said the company would fight the FTC. “While we believed in giving peace a chance, we have complete confidence in our case and welcome the opportunity to present our case in court,” he said.
