Xbox and Activision Blizzard acquisition deal likely to go ahead after all

Split opinions within the US regulatory body may prevent its efforts to block Microsoft’s Activision Blizzard buyout claims a new report.

Back when it was announced that Microsoft was buying Activision Blizzard for a cool $69 billion (£57 billion), it was widely assumed that the deal would go through with little issue.

However, as time has gone on, the acquisition has faced pushback from regulators. In fact, it was most recently claimed that the Federal Trade Commission (FTC) was planning to file an antitrust lawsuit to outright block it.

The situation has allegedly changed, though, as a new report states that the FTC may approve the acquisition after all, thanks to an internal split in voting intentions.

Originally, it was believed that the FTC, particularly its chairperson Lina Khan, was very sceptical about Microsoft’s assurances that the deal wouldn’t give it an unfair advantage in the games industry.

Of the four members of the FTC’s panel, only one – Republican Christine Wilson – has spoken in favour of the acquisition.

The other three members are Democrats (which includes Khan) and it’s believed that one of them has begun to sway in Microsoft’s direction.

This is according to the New York Post, whose sources says that a deadlocked vote would not only approve the deal but also undermine Khan’s authority and damage any potential lawsuit.

So, to avoid such a vote from happening, Khan and the FTC would instead agree to the deal, albeit with concessions.

‘Some of the Democrats might be more comfortable with a settlement,’ one FTC insider told the New York Post.

Any concessions from Microsoft would no doubt be the same or at least similar to what it’s reportedly offering in Europe. In order to receive approval, it’s apparently willing to make a formal commitment to keep Call Of Duty (one of the biggest sticking points about the entire ordeal) available on PlayStation for another 10 years.

Should Microsoft make these concessions to the FTC, any further resistance from the latter would only weaken attempts to block the deal according to former FTC chairman William Kovacic.

‘What makes it difficult is when Microsoft goes to their friends in blue and says, ‘We have provided a package of solutions for all the perceived problems, and the folks at the FTC are being very unreasonable if they don’t take it,’’ he explained to the New York Post.

The FTC hasn’t made any formal comments on the matter and is expected to make a recommendation on the deal later this month.

Microsoft, meanwhile, told the New York Post, ‘As we have said before, we are prepared to address the concerns of regulators, including the FTC, and Sony to ensure the deal closes with confidence.

‘We’ll still trail Sony and Tencent in the market after the deal closes, and together Activision and Xbox will benefit gamers and developers and make the industry more competitive.’

Its claims of the deal benefitting gamers and improving competition have been met with doubt here in the UK. The Competition and Markets Authority (CMA) has expressed similar concerns as Sony, about the deal weakening Microsoft’s competitors.

It’s currently in the process of conducting a second investigation, whilst Microsoft has made a number of claims to dispute the CMA’s issues with the deal.

Notable examples include downplaying the Call Of Duty brand as ‘nothing unique’ (despite it being one of the most profitable gaming franchises on the planet) and claiming that the main motivation behind the deal is Candy Crush developer King and its expertise in mobile gaming.

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