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Judge Jacqueline Scott Corley has ruled in the Federal Trade Commission case against Microsoft’s acquisition of Activision Blizzard. She ruled against the order, which will be lifted on July 14. This begs the question: what happens for both Activision Blizzard (and the FTC) in the immediate aftermath?
Xbox head Phil Spencer and Microsoft president Brad Smith both expressed their approval of the decision. Spencer said in a tweet: “We are grateful to the court for the swift decision in our favor. The evidence showed that the Activision Blizzard deal is good for the industry and that the FTC’s claims about console switching, multi-game subscription services and the cloud do not reflect the realities of the gaming market.”
Smith has issued a statement on behalf of Microsoft: “We are grateful to the court in San Francisco for this prompt and thorough decision and hope that other jurisdictions will continue to work towards a timely resolution. As we have consistently demonstrated throughout this process, we are committed to working creatively and collaboratively to address regulatory challenges.”
So said Bobby Kotick, CEO of Activision Blizzard an email to employees“The US joins the 38 countries where our deal can go ahead – these decisions are based on facts and data that show our merger is good for players and for competition in the industry.”
Industry-wide responses
Aside from the official responses from Microsoft and Activision Blizzard, several industry figures have reacted positively to the news that the acquisition is no longer stymied by the FTC. They also expressed hope that certain Activision Blizzard titles will be revived or come to Xbox Game Pass.
That said, there’s an equally vehement dissent that Microsoft’s acquisition of Activision Blizzard will hurt gamers by consolidating an oversized company under a major publisher. There was also some disappointment in the FTC for not making enough arguments to convince Judge Corley.
Still others pointed out that Activision Blizzard shares spiked in response to the news. The company’s stock rose 10% after the announcement, where it remained at the end of the day.
What comes next
The FTC still has the option to appeal Judge Corley’s decision, though it must do so before the injunction is lifted on July 14. If it doesn’t, Microsoft can complete the acquisition unopposed, at least in the US.
As for Microsoft, it has exactly one week to close the deal before the deadline. The next hurdle to clear is the British Competition and Markets Authority. The CMA had opposed the takeover, but in the wake of the FTC ruling, it allegedly suspended its own order in favor of negotiations with the company. According to a statement issued to VGCthe CMA said, “We stand ready to consider any proposals from Microsoft to restructure the transaction in a manner that addresses concerns raised in our final report.”
Regulatory authorities in Brazil, South Africa, Japan and China have already approved the acquisition. However, the US and the UK are currently the only countries that have opposed it The Canadian Competition Bureau has also expressed reservations about the deal, saying it is “likely to result in a substantial foreclosure and/or reduction of competition related to gaming consoles and multigame subscription services.”
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