Microsoft is trying to persuade regulators around the world to allow it Acquisition of Activision Blizzard for $68.7 billion – the biggest deal of its kind the gaming industry has ever seen. Amid concerns about its effect on competition in the industry, and in the face of fervent lobbying against the deal by competitor Sony, the US Federal Trade Commission has said will try to block the deal legallywhile the UK Competition and Markets Authority has also expressed skepticism.
Here’s the latest on Microsoft’s plans to acquire Activision Blizzard.
Google and Nvidia have reportedly raised concerns about the deal.
According to BloombergGoogle and Nvidia have echoed Sony in expressing their concerns to the FTC about the merger’s potential to crush competition, strengthening the regulator’s case as it prepares to take it to court in August.
Neither is as direct a competitor to Microsoft in gaming as Sony is, but the two do overlap. Nvidia’s core business is making graphics cards, but it also has a streaming service, GeForce Now, which is perhaps the closest competitor to Microsoft’s Cloud Gaming initiative. (GeForce Now doesn’t seem to currently offer any major Activision Blizzard games.) Nvidia is reportedly not directly opposed to the deal, but it did stress the need for open and equal access to Activision Blizzard games.
Google’s own streaming service, Stadia, is about to close. But the company has a keen interest in mobile gaming through its Google Play store and Android operating system, and in its acquisition of mobile giant King (Candy Crush) as part of the Activision Blizzard deal will make Microsoft a much bigger player in the space. Chances are your complaint is just one tech giant trying to curb the influence of another.
Microsoft says it hopes to bring its pro-union approach to Activision Blizzard
on January 1 6, as reported by The Verge, Microsoft published an ad in the Washington Post highlighting its acceptance of unions, co-signed by the Communication Workers of America union. “As we enter a new year, we remain committed to creating the best workplaces we can for people who make a living in technology. When both workers and management bring their voices to the bargaining table, employees, shareholders and customers alike benefit,” the note says. He then adds: “During 2023, we hope to bring the same agreement and principles to Activision Blizzard, which Microsoft has set out to acquire.”
This is certainly an argument for the FTC that Microsoft can improve working conditions at Activision Blizzard, which has shown resistance to a movement to unionize among its employees after the terrible scandal about its work culture in 2021. The ad highlights the Successful unionization of 300 Bethesda and ZeniMax workers after Microsoft’s acquisition of that company, concluding by saying, “We’re not asking the FTC to ignore concerns about competition. Rather, we believe it is important to explore solutions that protect competition and consumers while promoting the needs of workers and American economic growth and innovation.”
Microsoft admits it was wrong to call the FTC “unconstitutional”
As it seeks to smooth things over with a skeptical, if not hostile regulator, Microsoft has backtracked on one of the most inflammatory claims in its response to the FTC’s lawsuit seeking to block the merger. According to Axioson January 1, 5 Microsoft revised its filing to remove a claim that the FTC’s structure violates the US Constitution.
“The FTC has an important mission to protect competition and consumers, and we quickly updated our response to omit language that would suggest otherwise under the constitution,” Microsoft public affairs spokesman David Cuddy told Axios. “We initially put all potential arguments on the table internally and should have dropped these defenses before filing the lawsuit. We welcome feedback on these defenses and are engaging directly with those who raised concerns to clarify our position.” In other words: sorry, we know you were out of order, we were wrong.
FTC says it’s not in “substantive” negotiations with Microsoft
On Tuesday, Jan. The first pre-trial hearing of the FTC’s lawsuit trying to block the merger was held on February 3. At that point, FTC attorney James Weingarten said that the Commission had authorized settlement negotiations with Microsoft, but that “there are no substantive discussions at this time.”
This sounds like bad news for Microsoft, but “substantial” is the key word here. The two parties are no doubt in touch, and Microsoft will almost certainly make a settlement offer; these days, the tech giant is known for taking a collaborative approach with governments and regulators, and will be keen to close the deal ahead of its Activision bid. Blizzard expires in July 2023. The trial itself won’t start until August.
UK regulator says it needs more time to investigate the deal
on January 5, the UK’s Competition and Markets Authority, which, along with the FTC and the European Commission, is one of three regulators considered powerful enough to block the deal entirely. he said he would need more time to complete what it calls “phase two” of its deeper analysis of the deal.
The CMA originally hoped to conclude its deliberations by March 1, but has postponed this deadline to April 26. However, he says that he intends to conclude it before this date. The CMA has said it is “concerned” by the deal, and so far appears to be quite influenced by lobbying from Sony. Nevertheless, in a public consultationfound that the majority of responses were in favor of the deal (apart from the 500 that “contained abusive content (with no other substantial content), or were blank, unintelligible, said to be from non-UK consumers, or not They were in English.”
Chile approves the acquisition
the dec. 29/2022, National Economic Prosecutor of Chile became the last international regulator to approve the deal. He said he didn’t think the deal would significantly reduce competition, and he didn’t think it likely Microsoft would pull Call of Duty from other platforms, including PlayStation (this concern has been at the heart of Sony’s objection to the deal).
Here’s a list of all the countries that have approved Microsoft’s acquisition of Activision Blizzard so far:
- Saudi Arabia
What happens next?
The next important deadline is the verdict of the European Commission, which will be delivered on or before March 23.
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