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Thread: FTC Moves To Block Microsoft’s $69 Billion Purchase Of Activision

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    PC Games FTC Moves To Block Microsoft’s $69 Billion Purchase Of Activision

    By Ben Zeisloft - The Daily Wire




    Regulators at the Federal Trade Commission are attempting to block Microsoft from acquiring video game developer Activision Blizzard for $69 billion, claiming that the merger would enable the technology conglomerate to reduce market competition with subsidiary Xbox.

    The agency contended in a press release that Microsoft routinely acquires gaming companies to “suppress competition from rival consoles.” Members of the commission voted three to one on issuing the legal complaint.

    “Microsoft has already shown that it can and will withhold content from its gaming rivals,” FTC Bureau of Competition Director Holly Vedova remarked. “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.”

    Stock prices for Activision, which develops popular games such as Call of Duty and World of Warcraft, have risen more than 11% since the beginning of the year, but fell 1.4% on Thursday. Shares for Microsoft, which have fallen more than 26% this year, increased by 1%.

    Microsoft President Brad Smith contested the agency’s sentiments in a statement claiming that the firm already addressed antitrust worries from regulators. “We continue to believe that our deal to acquire Activision Blizzard will expand competition and create more opportunities for gamers and game developers,” he remarked. “While we believe in giving peace a chance, we have complete confidence in our case and welcome the opportunity to present it in court.”

    Smith argued in an opinion piece for The Wall Street Journal that purchasing Activision will allow Microsoft to more easily compete with Sony and Nintendo, which surpass Xbox in the console gaming space. Revenue generated by the video game platform dropped 3% year-over-year as of the company’s fiscal first quarter, according to an earnings report.

    “While modern consumers can stream videos or music on multiple devices on low-cost subscription plans, many games can often only be individually purchased and downloaded onto one device,” he wrote. “Microsoft wants to change that by offering consumers the option to subscribe to a cloud gaming service that lets them stream a variety of games on multiple devices for one reasonable fee. It would also benefit developers by allowing them to reach a much broader audience.”

    Policymakers at the FTC, however, believe that Microsoft could increase pricing at Activision, which is one of the few game developers creating high-quality products for multiple platforms.

    FTC Chair Lina Khan, a 33-year-old who also serves as a law professor at Columbia University, was overwhelmingly approved by the Senate last year on a hawkish approach toward regulating technology companies. A number of antitrust packages have been introduced to Congress by bipartisan coalitions over the past several years with negligible success.

    Khan emerged to prominence with an essay published in the Yale Law Journal, entitled “Amazon’s Antitrust Paradox,” which argued that the nation’s current regime of discouraging predatory pricing is inept to spurn abuses from online platforms.

    “The economics of platform markets create incentives for a company to pursue growth over profits, a strategy that investors have rewarded,” she wrote. “Because online platforms serve as critical intermediaries, integrating across business lines positions these platforms to control the essential infrastructure on which their rivals depend. This dual role also enables a platform to exploit information collected on companies using its services to undermine them as competitors.”

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    Take Box B DemonGeminiX's Avatar
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    Micro$hit's way too big as it is.


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    Music was better when ugly people were allowed to make it.

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    Basement Dweller Godfather's Avatar
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    Agreed. I hardly game anymore but selfishly I hope it's blocked for the gaming industry too. Just like everything, the smaller studios have all been gobbled up. The gaming industry is left with a couple of bloated, shitty companies releasing criminally unfinished "Triple A" priced games and it's just sad. Activision Blizzard is brutal as it is already.

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    blizzard is already a corporate monstrosity

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    I only ever played Diablo. I bought Diablo II, but never installed it. I figured I'd get around to it one day... years later...

    I've never really been much of a gamer to begin with. I enjoy some of the backstories, and if the adaptations are good, I'll watch the shows based on them, but I really couldn't be bothered otherwise.

    Microsoft's just one of those companies that irk me. Every subsequent Windows release, they're finding new ways of forcing you to divulge personal information. It's not so easy to avoid like it is with Google or Facebook. Sure, you can just use Linux, but what are you using at work? The world is way too dependent on them, and way too willing to let them take over their lives, and that means that you have to play ball to some degree. It just bothers me sometimes.


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    Ok I heard a counter argument on a podcast today against the FTC. They made some good points that there have been some other mergers they could've tried to go after and question why Lina Khan chose this one to fight. And if it's successfully blocked, it helps the other major gaming companies like Tencent, Nintendo and Sony... So what is the FTC's role here when the competitors are companies based in China and Japan? To protect industry competition generally or to also balance and protect US interests? I wish they'd talked more about it on that podcast because I really don't know but it was an interesting thought.

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