US calls for blocking Microsoft takeover of Activision

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New York (EFE) Microsoft, a deal valued at around $69 trillion.

According to the FTC, the purchase would harm consumers because it would allow Microsoft to harm competition in the video game industry by taking control of major franchises developed by Activision such as “Warcraft”, “Call of Duty” and “Candy Crush”. “

A computer and video game accessories are seen in a Microsoft store in New York (USA). EFE/EPA/Justin Lane

The lawsuit marks one of the strongest moves in recent years by US regulators to try to rein in the power of the tech giants.

Microsoft announced last February that it was buying Activision for nearly $69 trillion in cash, in what would be the biggest acquisition in the company’s history, the biggest deal of its kind seen in the world of video games and one of the oldest in technology in general.

Fusion

With Activision, Microsoft expected to become the third largest company in the video game industry, just behind Tencent and Sony.

The merger was being studied by regulators in different countries, but the FTC is the first to speak out officially and it does so to oppose the operation.

“Today, we seek to prevent Microsoft from taking control of the largest independent game studio and harming competition in several dynamic and fast-growing video game markets,” said Holly Vedova, director of the Office of the competition from the FTC, in a press release.

According to the American regulator, the technology company has already sought in the past to limit access to content to its competitors in the video game sector, offering games from companies it has acquired only on its Xbox consoles and on its own subscription service.

View of a Microsoft store in New York (USA), December 8, 2022. EFE/EPA/Justin Lane
View of a Microsoft store in New York (USA). EFE/EPA/Justin Lane

With the purchase of Activision, the FTC points out, it could do the same with some of the world’s most popular titles such as “Call of Duty”, “World of Warcraft”, “Diablo” and “Overwatch”, which are currently offered for various devices.

It would also have the ability to manipulate Activision’s pricing, delay access to games for other platforms, or degrade the gaming experience on other consoles.

In recent months, Microsoft has tried to appease regulators with certain measures, for example by offering Sony access to the game “Call of Duty” for a period of ten years or by bringing it to Nintendo consoles, where it is not currently available, if the purchase was closed.

Microsoft is not backing down

Microsoft announced today that it has no plans to drop the deal and will challenge the FTC’s arguments in court.

“We continue to believe that this agreement will broaden competition and create more opportunities for gamers and game developers,” Microsoft President Brad Smith said in a statement sent to various media outlets.

After learning of the FTC’s announcement, Activision shares on Wall Street suffered a sharp decline, although it was quick to recoup some of the losses and with 45 minutes to the close of trading, they fell 1.40%.

Those of Microsoft, meanwhile, did not see a very big impact and three quarters of an hour before the bell rang, they gained 1.10%.

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