Recently, it was revealed that the US Federal Trade Commission had once again taken up arms against Microsoft’s acquisition of Activision Blizzard. In a complaint filed to the US Court of Appeals, the FTC stresses that Microsoft’s dismissal of almost 2,000 employees – many of whom worked at Activision – is in direct contradiction to promises made during the acquisition process last year. It was said that Activision Blizzard would operate independently post-merger, but weeks after the deal was closed, Microsoft swarmed in and laid off hundreds of employees at the firm.
Further, the FTC highlighted that if it was able to successfully reverse the $69 billion merger, it would be impeded in its ability to ‘provide effective relief’ given the mass layoffs at AB. This is by no means the first time that the Federal Trade Commission has gone after Microsoft regarding the Activision Blizzard merger. For months, the organisation attempted to block the acquisition because it would lead to a monopoly being created, restricting fair competition in the games industry.
This Feels Familiar
Last year, the Microsoft x Activision Blizzard merger dominated headlines the world over. It became the most talked-about topic in gaming, and it led to several huge stories surfacing, particularly following sizeable leaks that revealed the future of Xbox and Activision, amongst other things. It was a saga that everyone knew about, and the inner workings of the court cases surrounding the merger were widely publicised. In December, the record-high $69 billion merger was closed – but that hasn’t stopped organisations like the FTC from staying connected to the goings-on.
In the open letter filed to the US Court of Appeals, the Federal Trade Commission wrote:
‘Microsoft reportedly has stated that the layoffs were part of an ‘execution plan’ that would reduce ‘areas of overlap’ between Microsoft and Activision, which is inconsistent with Microsoft’s suggestion to this Court that the two companies will operate independently post-merger.’
It’s a sticky spot for sure, but there are widespread expectations that the FTC will fall flat pursuing these claims. It would take something monumental for the FTC to fully overturn the acquisition at this point, especially given that the deal was cleared by so many regulatory bodies around the world.
In recent weeks, some huge topics have emerged from this circle. It was suggested that Microsoft will push Xbox games to competing platforms, for instance. There are plenty of developing stories to follow – it’s not yet known when the FTC will receive a response from the US Court of Appeals, but I’ll be here to cover that news when they do.
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