Dive Brief:
- The Federal Trade Commission is putting on pause its in-house case against Microsoft’s $69 billion acquisition of game maker Activision Blizzard, according to news reports.
- FTC official April Tabor ordered the case before the agency’s administrative law judge be put on hold, Reuters and other news outlets say.
- With this action, the only remaining block to the deal, which would be Microsoft’s largest and the largest in the gaming industry, is in the United Kingdom, where the Competition and Markets Authority has raised objections. However, the agency and Microsoft are reportedly near a deal.
Dive Insight:
The FTC’s decision to pause its in-house case comes after the agency failed to persuade a federal judge two weeks ago to back its motion for a preliminary injunction.
“The FTC has not shown a likelihood it will prevail on its claim this particular vertical merger in this specific industry may substantially lessen competition,” Judge Jacqueline Scott Corley of the U.S. District Court for the Northern District of California said in her July 10 ruling. “To the contrary, the record evidence points to more consumer access to Call of Duty and other Activision content.”
The FTC argued the deal would lessen competition among gaming console makers because it would allow Microsoft to pull the popular Call of Duty franchise off of PlayStation and Switch among other rival consoles, but Microsoft testified that it had no plans to do that.
Nor did the court find evidence other markets, including fast-growing streaming platforms, would be harmed by the acquisition.
Immediately after that loss, the FTC tried to pause the case before filing a full appeal, but the 9th Circuit Court of Appeals denied its request for emergency relief.
Analysts say the remaining hurdle, in the UK, is likely to be resolved quickly now that the deal is past these other roadblocks.
“It increasingly looks like all parties are willing to secure a remedy in the U.K.,” The Verge reported.
