·
2 minute read
The gaming world watches in anticipation as the battle between Microsoft and the Federal Trade Commission (FTC) reaches a crescendo. With the FTC opposing the court's approval of Microsoft's acquisition of Activision Blizzard, the industry is bracing for potential waves of change.
PHOTO ILLUSTRATION BY PAVLO GONCHAR/SOPA IMAGES/LIGHTROCKET VIA GETTY IMAGES
In this tempestuous legal tussle, we delve into ten key takeaways that offer a glimpse of how this high-stakes duel could ripple across the gaming industry. From the prospect of major players merging to concerns about competition and consumer access, we navigate through the uncertainties and potential outcomes that await. As the Ninth Circuit Court of Appeals and the UK's Competition and Markets Authority (CMA) weigh in, gaming enthusiasts around the globe await the verdict that could redefine the very tides of the gaming sea.
- Vertical Merger Approval: Microsoft won a court battle with the FTC, allowing them to move forward with the purchase of Activision Blizzard. This could have significant implications for the gaming industry due to the merging of two major players.
- Competition Concerns: The FTC is appealing the court's decision, arguing that the ruling did not consider potential negative effects on competition in the gaming market.
- Xbox Game Pass: The court's decision highlighted potential consumer benefits from Xbox Game Pass, a Microsoft service. This could indicate a shift towards subscription-based models and its impact on other gaming platforms.
- Foreclosure of Games: The FTC expressed concerns about Microsoft potentially restricting Activision Blizzard games, like Call of Duty, from appearing on other subscription platforms, potentially limiting consumer choice.
- Cloud Gaming: Microsoft's agreements to provide games to other cloud services were a point of contention. This raises questions about the future of cloud gaming and its impact on the industry.
- Consumer Access: The court's ruling emphasized the potential for increased consumer access to games, which Microsoft argues supports the acquisition's positive impact.
- CMA's Cloud Concerns: The UK's Competition and Markets Authority (CMA) also expressed concerns about the deal, particularly related to cloud gaming. Microsoft needs to address these concerns before closing the deal in the UK.
- Potential Merger Investigation: The CMA warned that restructuring the deal could lead to a new merger investigation. This could further delay the acquisition and impact its final terms.
- EU Approval with Licensing Deals: The EU approved the deal with licensing agreements that grant free licenses to consumers and cloud providers for streaming Activision Blizzard games. This approach may set a precedent for future mergers in the gaming industry.
- Regulatory Uncertainty: The ongoing appeals and negotiations with regulatory bodies create uncertainty around the deal's timeline and conditions, which may affect both companies and the broader gaming industry.
As the Ninth Circuit Court of Appeals and the CMA's decision play out, the gaming industry will closely watch how these events shape the future landscape of gaming giants and their impact on competition and consumer access to games.
