The possibility of an Activision Blizzard acquisition by Microsoft has run into more pushback. This is after a group of gamers teamed up to sue in an attempt to stop the technology giant’s buyout plans.
Just last week, ten gamers filed individual lawsuits against Microsoft’s plans to acquire Activision Blizzard’s Call of Duty franchise and other popular titles, including "World of Warcraft," "Overwatch" and "Diablo."
Since announcing the possible acquisition in January of this year, reactions have been mixed which has resulted in the deal not yet being finalized.
The group of fans argued that once the acquisition is made, it would provide Microsoft with single supremacy over the gaming industry. In turn, this could affect the possibility of competition by increasing price points and restricting competitors from releasing games on Microsoft platforms.
In other words, Microsoft’s acquisition of Activision Blizzard could kill the gaming market.
“The videogame industry may lose substantial competition, and Microsoft may have far-outsized market power, with the ability to foreclose rivals, limit output, reduce consumer choice, raise prices and further inhibit competition.” stated details in the legal complaint against Microsoft.
The complaint also states, “Vigorous enforcement of the antitrust laws by private persons is an essential part of the congressional plan to ensure that competition rather than monopoly is, and remains, the rule of trade in the United States, including in the video game industry.”
The lawsuit, filed in California, New Jersey and New Mexico, echoes the concerns of another lawsuit filed by the Federal Trade Commission.
After the announcement that Microsoft was set to acquire Activision Blizzard for a hefty price tag of $68.7 billion, one of the highest numbers in the history of gaming, the FTC filed a lawsuit in an attempt to prevent the deal from being brought to fruition. Their reasoning stated the acquisition’s impact on competitor companies.
“Microsoft has already shown that it can and will withhold content from its gaming rivals. 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,” said Holly Vedova, Director of the FTC’s Bureau of Competition.
As a response, Microsoft boldly tackled the FTC lawsuit. It publicly addressed the concerns, insisting that they were fully prepared for scrutiny from regulatory bodies considering the size of the acquisition. In an official statement to Bloomberg, Microsoft CEO Satya Nadella also noted Microsoft would be #4 in ranking in the gaming industry if the deal yielded success, while Sony topped the charts as the #1 player.
Activision Blizzard’s CEO Bobby Kotick supported these statements with an explanation of his own for CNBC: “Our industry has enormous competition and few barriers to entry. We have seen more devices than ever before enabling players a wide range of choices to play games.”
“Engines and tools are freely available to developers large and small. The breadth of distribution options for games has never been more widespread.” the CEO added.
The FTC hearing is scheduled to take place in August 2023. As for committed Call of Duty fans, Microsoft insists that it does not plan to take Call of Duty exclusive, and never will.
Microsoft has already responded saying that it will never take Call of Duty exclusive:— Geoff Keighley (@geoffkeighley) September 1, 2022
"We’ve said we are committed to making the same game available on the same day on both Xbox and PlayStation. We want people to have more access to games, not less." - Brad Smith, Microsoft
Time will tell whether Activision Blizzard will become a part of Microsoft. However, it is highly likely that the concerns may die down with positive reputation management from the tech giant.