Microsoft’s chances of completing its $70 billion acquisition of Activision Blizzard seem a bit slim this week. Citing three sources familiar with the matter, Politico reports that the US Federal Trade Commission (FTC) will “likely” try to block the deal with an antitrust suit.
The news comes as the deal is also being placed under close scrutiny by regulators in the UK and the European Union. Governments around the world are eager to rein in the power of big tech companies, and Microsoft’s power movement in gaming puts them in front of a big target. FTC Chair Lina Khan has been outspoken in her opposition to potential technology monopolies.
Politico’s sources say the decision has not yet been made, but that “the FTC staff reviewing the deal are skeptical of the companies’ arguments.”
Meanwhile, the war of words between Sony and Microsoft over the deal took an absurd turn on Wednesday when Britain’s regulator, the Competition and Markets Authority, released conflicting statements the two companies had made to their investigators in October. Sony is begging regulators to block the deal, as Microsoft says controlling Activision Blizzard, and specifically the Call of Duty franchise, will kill competition in the games market.
Both companies were put in the unusual position of being motivated to claim that their opponents are much more successful than they are, and went to great lengths to present themselves as the sloppy underdog.
“The suggestion that the incumbent market leader, Sony, with clear and lasting market power, could be foreclosed by the smallest of the three console competitors, Xbox, due to the loss of access to one title, lacks credibility,” Microsoft protested. (It’s also vehemently denied it would do such a thing in the first place; Microsoft gaming chief Phil Spencer said Call of Duty would stay on PlayStation “as long as there’s a PlayStation to ship to,” while the company told the New York Times Sony offered another 10 years of Call of Duty games.)
Microsoft also generously claimed that its own exclusive games were rubbish compared to Sony’s. “Sony has more exclusive games than Microsoft, many of which are of better quality,” it said, citing “iconic first-party franchises” like God of War and Uncharted. PlayStation had “nearly five times as many” exclusive titles as Xbox.
Sony’s response was to trash its own subscription service. “Game Pass Leads PlayStation Plus Significantly”, it moaned. “Microsoft already has a substantial lead in multi-game subscription services. Game Pass has 29 million subscribers on the Xbox Game Pass console and Xbox Game Pass Ultimate and is expected to grow significantly in the future. PlayStation Plus multi-game subscription levels are significantly behind,” it humbly added.
Sony also casually snapped shots of EA’s Battlefield series, claiming that Call of Duty is too popular in its field to compete with should Microsoft make it an exclusive. “Even assuming SIE had the ability and resources to develop a similarly successful Call of Duty franchise,” said Sony, “it would take many, many years and billions of dollars to develop a Call of Duty challenger. create – and the example of EA’s Battlefield shows that such efforts are more than likely to fail.” Shots fired!
Microsoft aims to complete the acquisition of Activision Blizzard sometime before mid-2023.