The closely watched legal battle between Microsoft and the Federal Trade Commission (FTC) over the acquisition of Activision Blizzard has reached its conclusion. Judge Jacqueline Scott Corley ruled in Microsoft’s favor, confirming in a 53-page decision document that the acquisition can be completed before the final trade deadline of July 18, 2023, after which Microsoft will have to pay Activision Blizzard a $3 billion severance fee for terminating the original deal . However, it is important to remember that Microsoft has not been satisfied by the regulatory authorities in Great Britain, so if the Redmond giant wants to close the acquisition, it will probably not do without further negotiations with the British Competition and Markets Authority (CMA). Microsoft has already appealed the decision, with a hearing set to begin on July 28.
Here’s the document. 53 pages. Public redacted version. So contrary to what she said at the hearing, she made a public version available immediately, which is great!
I’m studying it now and will share observations in this developing thread.
🧵3/X
— Florian Mueller (@FOSSpatents) July 11, 2023
“This acquisition is described as the largest in the technology industry. And as such, it deserves a lot of attention,” the magazine quotes the court’s decision, for example PushSquare. The judge further states that Microsoft has committed verbally and in writing to keep Call of Duty on PlayStation for at least the next 10 years, at the same level as on Xbox, which the court’s decision should have contributed to. But even more important was the finding that the Federal Trade Commission had not sufficiently demonstrated future distortion of competition if the acquisition was successfully completed, and it was for this reason that the court rejected the Commission’s demands. Shares of Activision Blizzard jumped nearly 12% to a two-year high of $92.20 in response to today’s ruling. Even in the court’s decision it coststhat the acquisition is probably bad for Sony, but good for gamers.
To the result, of course said Microsoft President Brad Smith, who said he was grateful to the San Francisco court for this quick and thorough decision, as well as Xbox boss Phil Spencer and Activision Blizzard CEO Bobby Kotick. “Our merger will benefit both consumers and employees. It will allow for competition rather than incumbent market leaders continuing to dominate our fast-growing industry,” Kotick said in a statement. Spencer also expressed gratitude to the court for the quick decision in their favor, as he wrote on Twitter. “The evidence showed that the Activision Blizzard deal is good for the industry and that the FTC’s claims about switching consoles, subscriptions and the cloud do not reflect the reality of the gaming market. Since we announced this deal, our commitment to bringing more games to more people on more devices has only grown. We’ve signed several deals that will make Activision Blizzard games, first-party Xbox games and Game Pass available to more players than today. We know players around the world are watching this case closely, and I’m proud of our efforts to expand player access and choice along the way,” Spencer concluded his thread.
1/We’re grateful to the court for swiftly deciding in our favor. The evidence showed the Activision Blizzard deal is good for the industry and the FTC’s claims about console switching, multi-game subscription services, and cloud don’t reflect the realities of the gaming market.
— Phil Spencer (@XboxP3) July 11, 2023
However, this enthusiasm is not shared by everyone, specifically, for example, the Federal Trade Commission itself, for which the spokesman Douglas Farrar expressed himself: “We are disappointed by this result, given the clear threat this merger poses to open competition in the field of cloud gaming, subscription services and consoles. According to him, the FTC intends to announce another step in the coming days, which will continue the fight to preserve competition and protect consumers. The FTC has until July 14 at 11:59 p.m. to appeal. In addition to the FTC, of course, the aforementioned problem with the CMA, which decided to block the acquisition in April, still persists. Just moments after today’s ruling, Microsoft agreed with the CMA to suspend the legal battle in the UK so they could begin negotiating a revised agreement that could address the CMA’s cloud concerns. This will still have to be approved by the UK’s Competition Appeal Tribunal (CAT), but all parties appear to be willing to negotiate.
“We are prepared to consider any proposals from Microsoft to modify the transaction.”
Since European regulators have already approved the acquisition, Microsoft could proceed despite the CMA and FTC, but it would not be a smooth and ideal process, so Microsoft and now only the CMA would rather avoid it. Brad Smith has already confirmed that their attention is now turning back to CMA and they intend to work things out. “While we do not agree with the CMA’s objections, we are considering how the transaction could be modified to resolve these objections in a manner acceptable to the CMA,” he told GamesIndustry.biz magazine. “We are prepared to consider any proposals from Microsoft to modify the transaction in a way that would address the concerns raised in our final report,” the CMA said in a statement to the same magazine. Today’s victory is a big leap for Microsoft, but it still hasn’t won, and we’ll still have to wait for the completion of the acquisition.
2023-07-11 15:54:28
#Microsoft #wins #FTC #lawsuit #buy #Activision #Vortex
