Microsoft has cleared a major hurdle to buy Activision Blizzard after a US judge denied the Federal Trade Commission’s attempt to stop the acquisition.
Judge Jacqueline Scott Corley sided with the tech company, saying the FTC failed to make a strong case that the Microsoft-Activision merger would hurt competition in the video game industry. “To the contrary, the record evidence points to more consumer access to Call of Duty and other Activision content. The motion for a preliminary injunction is therefore DENIED,” she wrote.
According to Corley, the proposed merger has already received a great deal of scrutiny, which has “paid off” in pushing Microsoft to address the antitrust concerns.
“Microsoft has committed in writing, in public, and in court to keep Call of Duty on PlayStation for 10 years on parity with Xbox. It made an agreement with Nintendo to bring Call of Duty to Switch. And it entered several agreements to for the first time bring Activision’s content to several cloud gaming services,” she wrote.
In response to the news, Xbox Chief Phil Spencer said: “The evidence showed the Activision Blizzard deal is good for the industry and the FTC’s claims about console switching, multi-game subscription services, and cloud don’t reflect the realities of the gaming market.”
The ruling paves the way for tech giant to complete the merger in the US ahead of a July 18 deadline. However, the FTC could appeal the judge’s ruling.
In a statement to IGN, the FTC hinted it might try to stop the deal. "We are disappointed in this outcome given the clear threat this merger poses to open competition in cloud gaming, subscription services, and consoles. In the coming days we'll be announcing our next step to continue our fight to preserve competition and protect consumers,” the Commission said.
Although the EU already approved the acquisition, Microsoft still has to deal with regulators in the UK, who blocked the deal on concerns the merger will undermine competition. Microsoft President Brad Smith is now indicating the company is ready to negotiate with the UK's Competition and Markets Authority to a compromise rather than fight the regulator in court.
"While we ultimately disagree with the CMA's concerns, we are considering how the transaction might be modified in order to address those concerns in a way that is acceptable to the CMA," he tweeted today. "In order to prioritize work on these proposals, Microsoft and Activision have agreed with the CMA that a stay of the litigation in the UK would be in the public interest."