It is not surprising that the American competition regulator is turning against the billion-dollar takeover of game company Activision Blizzard by Microsoft.
In fact, it seems the mission of Lina Khan, the new chair of the Federal Trade Commission (FTC), is to take a stand against any excess of Big Tech.
Progressive anti-trust lawyer Khan (33) was more or less appointed by US President Joe Biden in June 2021 to shake up US competition law. The rules to tackle monopolies would not have evolved with the development of the digital economy.
The FTC announced on Thursday that it had filed a lawsuit to block the acquisition of Activision Blizzard. It is one of the most aggressive actions by the regulator in years, wrote the press in the US.
The acquisition announced in February would be the largest ever for Microsoft. The purchase was initially on the books for $ 75 billion (71 billion euros), but has now been adjusted to $ 68.7 billion due to Activision’s cash position.
Microsoft is mainly targeting Activision Blizzard, known for titles such as call of Duty, World of Warcraft, Overwatch and Candy Crush Saga, to improve its position against the Chinese concern Tencent and the Japanese Sony. Tencent is big on mobile games, Sony makes the PlayStation.
With a global market share of 11 percent, the combination Microsoft / Activision would become the third largest game company in the world, according to the Bloomberg news agency. Microsoft’s games division, which makes the Xbox gaming console and also publishes games, is the best-selling consumer arm of the automation company.
The FTC fears that Microsoft will release Activision Blizzard’s successful games exclusively for its own Xbox. Now you can play their games, like Call of Duty and Candy Crush, on a variety of devices: some on Sony’s PlayStation and Nintendo’s Switch, others on PC and mobile.
Microsoft indicated that it wants to buy Activision Blizzard to become stronger in mobile games. Candy Crush Saga, from Activision subsidiary King, has been making billions since 2012.
The discussion surrounding the acquisition recently focused on Call of Duty. That series has been around for nineteen years and has raised an estimated $ 30 billion. Microsoft wanted to appease the FTC by making an agreement with Nintendo to release Call of Duty for the Switch for ten years: you can’t play that game on that right now. Microsoft also wanted such a contract with Sony, but the Japanese company refused. Sony is lobbying heavily against the Activision deal.
The FTC expects the first hearing on the acquisition of Activision Blizzard to take place in August.