The United States District Court for the Northern District of California has denied the US Federal Trade Commission’s push to block Microsoft from acquiring Activision Blizzard. In early 2023, the FTC filed an injunction against Microsoft, alleging its merger plans would hurt competition in the games industry worldwide. Now, that injunction has been quashed.
Microsoft is officially cleared to acquire Activision Blizzard in the United States – on the basis of its commitment to Call of Duty non-exclusivity, and its newly-established agreements with cloud gaming providers.
‘Microsoft’s acquisition of Activision has been described as the largest in tech history. It deserves scrutiny,’ judge Jacqueline Scott Corley said in the court ruling. ‘That scrutiny has paid off: Microsoft has committed in writing, in public, and in court to keep Call of Duty on PlayStation for 10 years on parity with Xbox. It made an agreement with Nintendo to bring Call of Duty to Switch. And it entered several agreements to for the first time bring Activision’s content to several cloud gaming services.’
‘The Court finds the FTC has not shown a likelihood it will prevail on its claim this particular vertical merger in this specific industry may substantially lessen competition. To the contrary, the record evidence points to more consumer access to Call of Duty and other Activision content.’
In the hours following the public announcement of the FTC’s decision, Microsoft president Brad Smith revealed the company’s ongoing appeal with the UK’s Competition and Markets Authority has been temporarily paused, as both companies have decided to work together for a mutually-agreeable solution to alternate concerns around cloud gaming.
‘Microsoft and Activison have agreed with the CMA that a stay of the litigation in the UK would be in the public interest and the parties have made a joint submission to the Competition Appeal Tribunal to this effect,’ Smith said.
A mutual agreement with the CMA will likely be the final hurdle to Microsoft being cleared to acquire Activision Blizzard. We’ll hear more about this decision, and any remaining complications, in the coming weeks.