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November 24, 2022 07:12 am GMT

The FTC might file an antitrust lawsuit to block Microsoft's Activision purchase

Microsoft's $69 billion purchase of Activision Blizzard is facing scrutiny from antitrust investigators in several countries. In the US, for instance, the Federal Trade Commission (FTC) started looking into the acquisition shortly after it was announced. Now, the FTC is reportedly ready to take action and will likely file an antitrust lawsuit to block Microsoft's massive purchase, according to Politico. Microsoft failed to convince the FTC staff reviewing the deal with its arguments, Politico's sources said, but the agency's commissioners have yet to vote on filing a complaint or to meet with lawyers.

While a lawsuit is not 100 percent guaranteed yet, the commission is reportedly done with the biggest parts of the investigation, including with the depositions of the Microsoft chief Satya Nadella and Activision CEO Bobby Kotick. If the FTC ultimately decides to file a lawsuit, it could do so as soon as next month. The publication says the commission will likely file the case in its own in-house administrative court, since it doesn't have to bring it to federal court first to seek a temporary injunction. Seeing as other regulators are also looking into the acquisition, it wouldn't be able to go through (if it's ultimately allowed to do so) until sometime next year.

In the UK, the Competition and Markets Authority (CMA) launched an in-depth investigation of the deal in September. And more recently, the European Commission announced that it will carry out a full-scale probe into Microsoft's purchase. Like these two European regulators, the FTC is concerned that the acquisition will give Microsoft an unfair advantage in the gaming sector and that it may significantly reduce competition in the market.

Sony has been one of the loudest voices opposing the deal and has expressed concerns that Microsoft might make valuable IPs like Call of Duty an Xbox exclusive. Jim Ryan, Sony PlayStation's CEO, previously revealed that Microsoft only offered to keep Call of Duty available on PlayStation for three years after the current agreement ends. But Xbox chief Phil Spencer said more recently that the company is "not taking Call of Duty from PlayStation." In Microsoft's latest filing with the CMA, it argued that the acquisition won't give it an unfair advantage: Sony has more exclusive games than the Xbox, it said, and many of them are of "better quality."

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