Control of tech giants
The United States Federal Trade Commission has filed a lawsuit aimed at blocking the proposed acquisition of Activision Blizzard by Microsoft, a deal valued at roughly 69 billion dollars. The FTC argues that the transaction could harm consumers by reducing competition in the video game industry and by giving Microsoft control over major Activision franchises such as Warcraft, Call of Duty, and Candy Crush.
Control of tech giants
This legal action represents one of the boldest moves by U.S. regulators in recent years to curb the influence of large technology companies. The action underscores a broader push by authorities to scrutinize how dominant platforms shape competitive dynamics across entertainment and digital services.
Microsoft announced in February that it would acquire Activision, marking the largest deal in the company’s history and a historic milestone in the video game sector. The acquisition positioned Microsoft as a major player in the industry, placing it behind only Tencent and Sony in terms of scale and influence.
Regulators around the world opened inquiries into the merger, with the FTC taking the lead in the United States by publicly opposing the deal. Holly Vedova, director of the FTC’s Bureau of Competition, stated that the agency seeks to stop Microsoft from gaining control of a prolific independent game studio and potentially diminishing competition in the dynamic and fast-growing gaming market.
The FTC contends that Microsoft has previously limited access to content for competitors and tends to offer games from acquired studios primarily through its Xbox platform and its own subscription services. The agency warns that controlling Activision could enable Microsoft to apply similar strategies to popular titles such as Call of Duty, World of Warcraft, Diablo, and Overwatch, potentially limiting availability across devices and platforms.
The regulator also warns that Microsoft could influence pricing, delay game releases on rival platforms, or otherwise degrade the gaming experience on consoles not owned or controlled by Microsoft. In recent months, Microsoft has attempted to ease regulator concerns through measures that include granting Sony access to Call of Duty for a decade and offering some games to Nintendo consoles if certain conditions are met.
Microsoft continues
Microsoft has indicated that it intends to contest the FTC’s claims in court and does not plan to halt operations in the near term. The company maintains that the deal will expand competition and create more opportunities for gamers and developers alike, a viewpoint voiced by Microsoft executive Brad Smith in comments to the media.
Following the FTC’s announcement, Activision’s stock dipped on the New York Stock Exchange, slipping briefly before recovering some losses. The market reaction contrasted with a modest rise in Microsoft shares in the same trading window, reflecting differing investor perceptions about the potential outcome of the lawsuit and the broader implications for the tech and gaming ecosystems.
The ongoing regulatory process will examine the merger from multiple angles, including potential impacts on game distribution, platform interoperability, and the availability of Activision titles across devices beyond Microsoft’s ecosystem. Industry observers note that the case could set important precedents for how major tech and entertainment mergers are evaluated in the United States and abroad, particularly in markets where competition authorities are increasingly vigilant about consolidation in digital services.