In one of the most aggressive antitrust moves taken against Big Tech in recent history, the Federal Trade Commission (FTC) announced on Thursday that it is moving to block Microsoft’s $69 billion acquisition of video games company Activision Blizzard.
The agency is suing over concerns that the acquisition would give Microsoft, which makes game console Xbox, too much power over the gaming industry and is “reasonably likely to substantially lessen competition or tend to create a monopoly in multiple markets,” the agency wrote in its complaint. The FTC points out that the $1.8 trillion company, which has had multiple major tech acquisitions approved by regulators over the past decade, has a history of acquiring gaming companies and using their ownership to suppress competition.
Activision Blizzard is one of the gaming industry’s largest developers. It is behind best-selling game franchises like Call of Duty, World of Warcraft, Overwatch, and Candy Crush, and the company says it has nearly 370 million active users monthly.
“Activision currently has a strategy of offering its games on many devices regardless of producer. But that could change if the deal is allowed to proceed,” the FTC wrote in a press release.
“With control over Activision’s blockbuster franchises, Microsoft would have both the means and motive to harm competition by manipulating Activision’s pricing, degrading Activision’s game quality or player experience on rival consoles and gaming services, changing the terms and timing of access to Activision’s content, or withholding content from competitors entirely, resulting in harm to consumers,” the release continued.
If the acquisition were to go through, it would be the largest consumer technology purchase in two decades — worth more than Elon Musk’s $44 billion purchase of Twitter — and would be the largest acquisition in Microsoft’s and in video game history, according to the FTC’s complaint.
Microsoft intends on fighting against the FTC’s decision in court, and Microsoft’s vice chair and president Brad Smith said in a statement that the company believes the acquisition “will expand competition” in the industry.
The acquisition has been under scrutiny from European regulators, who are also concerned about the potential for the deal to reduce competition in the gaming industry. The EU opened an investigation into the merger last month, saying that Microsoft “may foreclose access” to Activision Blizzard’s games with its acquisition.
The FTC suit is one of agency chair Lina Khan’s biggest antitrust moves yet. Khan, who was nominated to lead the FTC by President Joe Biden last year, was a champion of the antitrust movement before her nomination and had a major hand in shaping current views of antitrust laws.
Her nomination was supposed to portend a new era of enforcement for antitrust regulations, but her first year as chair hasn’t been quite as bold as antitrust advocates and the business community had expected when she was picked. With a new Democratic majority in the five-member commission, however, Khan may now be empowered to take more decisive action — like taking on Microsoft.
We’re not backing down in the face of Trump’s threats.
As Donald Trump is inaugurated a second time, independent media organizations are faced with urgent mandates: Tell the truth more loudly than ever before. Do that work even as our standard modes of distribution (such as social media platforms) are being manipulated and curtailed by forces of fascist repression and ruthless capitalism. Do that work even as journalism and journalists face targeted attacks, including from the government itself. And do that work in community, never forgetting that we’re not shouting into a faceless void – we’re reaching out to real people amid a life-threatening political climate.
Our task is formidable, and it requires us to ground ourselves in our principles, remind ourselves of our utility, dig in and commit.
As a dizzying number of corporate news organizations – either through need or greed – rush to implement new ways to further monetize their content, and others acquiesce to Trump’s wishes, now is a time for movement media-makers to double down on community-first models.
At Truthout, we are reaffirming our commitments on this front: We won’t run ads or have a paywall because we believe that everyone should have access to information, and that access should exist without barriers and free of distractions from craven corporate interests. We recognize the implications for democracy when information-seekers click a link only to find the article trapped behind a paywall or buried on a page with dozens of invasive ads. The laws of capitalism dictate an unending increase in monetization, and much of the media simply follows those laws. Truthout and many of our peers are dedicating ourselves to following other paths – a commitment which feels vital in a moment when corporations are evermore overtly embedded in government.
Over 80 percent of Truthout‘s funding comes from small individual donations from our community of readers, and the remaining 20 percent comes from a handful of social justice-oriented foundations. Over a third of our total budget is supported by recurring monthly donors, many of whom give because they want to help us keep Truthout barrier-free for everyone.
You can help by giving today. Whether you can make a small monthly donation or a larger gift, Truthout only works with your support.