Microsoft’s Activision Blizzard acquisition now looks more likely to happen, as a US court rules against the FTC’s attempted injunction.
In a dramatic turn of events, the San Francisco court has ruled against the Federal Trade Commission’s injunction request, which would have forestalled Microsoft’s planned acquisition of Activision Blizzard.
As reported by IGN, Judge Jacqueline Scott Corley made the ruling on 11 July, stating that while Microsoft’s deal “deserved scrutiny”, the June court case had provided the means to do so – and in that process, Microsoft had made sufficient commitments that Call of Duty would continue to appear on rival platforms.
“Microsoft’s acquisition of Activision has been described as the largest in tech history,” Judge Corley said. “It deserves scrutiny. That scrutiny has paid off: 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.”
Judge Corley later added, “For the reasons explained, the Court finds the FTC has not shown a likelihood it will prevail on its claim this particular vertical merger in this specific industry may substantially lessen competition. 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.”
The judge’s ruling means that the only remaining roadblock to Microsoft’s deal is the UK’s Competition and Markets Authority (CMA). The CMA blocked the deal in April, arguing that Microsoft’s planned merger with Activision Blizzard would make the combined entity overly dominant in the nascent cloud gaming sector.
Microsoft is in the process of appealing that ruling – and its win against the FTC in US courts may help its case in the UK, given that the CMA is currently the only remaining holdout.
In a statement to Eurogamer, Microsoft says that it is “considering how the transaction might be modified in order to address those concerns in a way that is acceptable to the CMA.”
Yesterday’s court ruling may have increased Microsoft’s chances of success, but the deal still has yet to be made. Microsoft has until 18 July – less than a week – to push the acquisition through.
