The FTC Is Suing Microsoft to Block It From Purchasing Activision Blizzard, a Video Game Holding Company

The Federal Trade Commission said it could be negative for competition in the gaming sector.

learn more about Gabrielle Bienasz

By Gabrielle Bienasz • Dec 8, 2022

Bloomberg I Getty Images
Activision's offices in 2021

The Federal Trade Commission has moved to stop Microsoft from purchasing video game holding company, Activision Blizzard, according to the Wall Street Journal.

"Microsoft has already shown that it can and will withhold content from its gaming rivals," said Holly Vedova, director of the FTC's Bureau of Competition, which focuses on antitrust enforcement, in a statement.

"Today we seek to stop Microsoft from gaining control over a leading independent game studio and using it to harm competition in multiple dynamic and fast-growing gaming markets," she added.

Microsoft moved to purchase Activision Blizzard in January in an all-cash deal that was valued at around $70 billion. "When the transaction closes, Microsoft will become the world's third-largest gaming company by revenue, behind Tencent and Sony," the company wrote in a statement at the time.

Activision Blizzard owns tiles such as "Guitar Hero" and "Call of Duty." It was founded in 1979 and is headquartered in Santa Monica, California.

"The $69 billion deal, Microsoft's largest ever and the largest ever in the video gaming industry, would enable Microsoft to suppress competitors to its Xbox gaming consoles and its rapidly growing subscription content and cloud-gaming business," the FTC added in its statement.

Because of the suit, the case will now head to court. The FTC and Department of Justice have the legal authority to examine mergers, generally speaking, of over $101 million in value, and can use legal tools to block them if they find they will "substantially lessen competition."

Microsoft has already said it plans to push back against the block.

"While we believed in giving peace a chance, we have complete confidence in our case and welcome the opportunity to present our case in court," a spokesperson for the company said, per The Washington Post.

Gabrielle Bienasz

Entrepreneur Staff

Gabrielle Bienasz is a staff writer at Entrepreneur. She previously worked at Insider and Inc. Magazine. 

Related Topics

Editor's Pick

Have More Responsibilities at Work, But No Pay Bump? Use This Script to Get the Raise You Deserve.
Black and Asian Founders Face Opposition at All Levels — Here's Why That Has to Change
Business News

The Scam Artist Who Robbed Backstreet Boys and NSYNC Blind. 'Some of the Guys Couldn't Pay Their Car Payment.'

In the 1990s, Lou Pearlman made millions creating the Backstreet Boys and NSYNC. It was all a giant Ponzi scheme.

Marketing

How AI Writing Tools Like ChatGPT Can Make Marketing Easier

With the explosion in popularity of Open AI's ChatGPT tool, it's not a shock that artificial intelligence is the talk of the business world. Here's how you can use it to make marketing cheaper and easier this year.

Thought Leaders

5 Small Daily Habits Self-Made Millionaires Use to Grow Their Wealth

We've all seen what self-made millionaires look like on TV, but it's a lot more subtle than that. Brian Tracy researched what small daily habits these successful entrepreneurs adopted on their journey from rags to riches.

Business Solutions

What Bill Gates and Steve Jobs Taught Me About Getting to Know Your Customers

Despite the push toward chatbots and technology-driven customer service, nothing can replace determining what your customers want through personal social interaction.