To avoid Microsoft monopolizing the market, the FTC will scrutinize the recent acquisition of Activision Blizzard.
There have been many major acquisitions announced in the gaming industry recently namely: Take-Two interactive acquiring Zynga for $11 billion and Sony acquiring Bungie for $3.6 billion, but most notably and perhaps the largest was that of Microsoft which has bought Activision Blizzard for almost $70 billion.
Even though these companies have made deals between them it doesn’t make any of these deals final as ultimately the FTC (Federal Trade Commission) seems to have the last say.
The Federal Trade Commission (FTC) is an independent US government organization responsible for protecting consumers and preserving a healthy competitive market. They are in charge of ensuring that no single company, in this example gaming, gains control of a market, giving them the power to set pricing and standards.
The current chairperson of the FTC is Lina Khan and she has been a lot more forceful than previous chairs in governing deals by major companies. Khan most notably sued to stop two large takeovers due to monopolization: Nvidia’s acquisition of Arm and Lockheed Martin’s acquisition of Aerojet Rocketdyne.
The Microsoft /Activision deal will not only have to have the approval of the FTC but because Microsoft is a global company the acquisition will have to be approved by the European and Chinese regulatory boards as well.
The acquisition might look like a bum deal to outsiders as Activision Blizzard has had its share of controversy lately what with all the abuse allegations etc. But Microsoft has vowed to hold all teams and all leaders to the commitment of a healthy and equal working environment and has said that leadership is “looking forward to extending our culture of proactive inclusion to the great teams across Activision Blizzard.”
So it seems that Microsoft already has plans in place to deal with the toxic working environments haunting Activision’s past.
Activision Blizzard has apparently been shopping around, according to an insider:” Activision made calls to try to find other interested parties. Those included Facebook parent Meta Platforms Inc. and at least one other big company.”
Given that this is one of the largest purchases in the gaming business, it is only inevitable that it would be scrutinized by a number of parties, including the major regulatory agencies. Will the Federal Trade Commission step in? Only time will tell, but we’ll keep an eye on the newest developments for you, our dedicated readers, till then.