The FTC Is Trying To Get Back Into The Ring With Microsoft Over Activision Deal
from the probably-too-late dept
Uh, well, okay then. I really thought we were done with the whole Microsoft buying Activision Blizzard saga. Hell, I even wrote what I thought was a final post on the matter, called the post a curtain call, and discussed how the deal had passed all the regulatory barriers and had been consumated. That happened after the FTC lost in court on its request for a TRO to block the deal and then subsequently paused on its suit entirely, clearing the way for the deal to move forward. At the time, the FTC made some noises about appealing the lower court’s decision, but then didn’t.
Until now. Nearly five months later, the FTC has appealed the court’s decision, arguing that the lower court essentially just believed whatever Microsoft said at face value.
The US government told a federal appeals court Wednesday that Microsoft’s recent purchase of Activision should not have been cleared by a lower-court judge, because the judge had been too deferential to Microsoft’s promises about the future of “Call of Duty,” a popular first-person shooter game.
District Judge Jacqueline Scott Corley went too far, the Federal Trade Commission argued, when she ruled in July that 11th-hour contracts Microsoft signed with Nintendo, Nvidia and other gaming companies concerning “Call of Duty” would resolve anticompetitive concerns related to the blockbuster deal.
Even if you think that the FTC’s argument is valid, which I very much do and wrote about at the time, I will be completely surprised if this gets any traction. Too much has progressed in too many places, especially in the European markets, to imagine the courts somehow coming back 2 months after this deal was completed and unringing the bell.
The only shred of hope I could see this having is the part of the FTC’s argument in which it claims that Microsoft’s decision to go around inking a bunch of 10 year deals to bring certain titles, namely the Call of Duty series, to non-Microsoft platforms altered the landscape the FTC was analyzing so significantly that it didn’t have the time dig into the details and build an argument against that new landscape.
“I fail to understand how giving somebody a monopoly of something would be pro-competitive,” said Imad Dean Abyad, an FTC attorney, in the argument Wednesday before the appeals court. “It may be a benefit to some class of consumers, but that is very different than saying it is pro-competitive.”
Abyad said that Microsoft’s flurry of licensing agreements in response to regulator scrutiny altered the economic picture in ways the FTC did not have an opportunity to fully review but that courts are now forcing it to accept.
“What the district court relied on, mostly, are contracts that were entered into after the [FTC] complaint was filed,” Abyad said. “The facts were changing all along. Even after the district court decided the case, Microsoft went ahead and entered into yet another contract [to restructure the cloud licensing rights].”
We said at the time that Microsoft was clearly taking the complaints from various regulatory bodies as some sort of paint by numbers prescription as to what deals to make to get around them. And I very much can see the FTC’s point on this. It brought a complaint under one set of facts only to have Microsoft alter those facts, leading to the courts slamming the deal through before the FTC had a chance to amend its arguments.
But ultimately it won’t matter. This last gasp attempt will almost certainly fail. American regulatory bodies have dull teeth to begin with and I’ve seen nothing that would lead me to believe that the courts are going to allow the agency to unwind a closed deal after everything it took to get here.
Filed Under: antitrust, call of duty, ftc, mergers
Companies: activision blizzard, microsoft


Comments on “The FTC Is Trying To Get Back Into The Ring With Microsoft Over Activision Deal”
This comment has been flagged by the community. Click here to show it.
In a sense it doesn’t matter that you agree with her conclusions (you shouldn’t). What she wants to do is extra-legal, it always was. The FTC does not have the right to make these decisions, that’s literally the whole thing.
Do you believe in a representative republic, with seperation of powers? Of then this has no legal basis and should be thrown out.
IF not, you’re just another libertard looking to ignore the constitution because it binds you.
Either results in “go pound sand” frankly.
Re:
Don’t worry, guys! Constitutional scholar extraordinaire, Bratty Matty, is here to show us the error of our ways!
Re: Re:
The man is just an empty vessel that gets periodically filled with whatever new, basket case, political and/or legal theory the rightwing holds. Then he comes here and it leaks out.
That’s why Microsoft has rushed the acquisition, to avoid years of lawsuits and finally give up.
Ten years is a lot in the gaming industry but two years is nothing in justice world.
Anti-competitive behavior is terrible today! Next week though...
The fact that the licensing deals have an expiration date really should have been enough to shoot the entire thing down as that all but confirms that they absolutely plan on making the series/games exclusive to their consoles/services, which was the entire problem to begin with.
Re:
Uh, nearly all windows games can be played on Mac, BSD, and Linux with a bit of work and know how.
You may have lost CensorStation but you gained 3 new platforms.
Re: Re:
VM does not provide the user with the same resources that would be available when not in VM. I know, it’s obvious. Some games will not function well on equipment that is not bleeding edge.
Re: Re: Re:
You have a partial point there. Yet anything Microsoft designs/develops runs well on windows. And just about anything written windows-first (as opposed to works-on) works perfectly after a few weeks in crossover, and parallels.
I won’t lie about being ticked off at Sony. Their game breaking censorship was the last straw for me and I walked away from a nearly thousand dollar account. But the only people screaming here are Sony users and some government types. Everybody else is happy. This deal puts a massive amount of money behind a game studio already known for some stellar content.
There’s a lot of new potential here.
Re: Re: Re:2
LILD: “nearly all windows games can be played on Mac, BSD, and Linux with a bit of work and know how”
AC: “VM does not provide the user with the same resources that would be available when not in VM. I know, it’s obvious. Some games will not function well on equipment that is not bleeding edge.”
LILD: “You have a partial point there.”
There is either a point or not, there is no partial.
What specifically is incorrect about the comment you claim to be partial?
Re: Re: Re:3
partial: your now have two platforms instead of one. Windows and Xbox.
Rather than just Xbox or just Sony.
Nearly all windows games today run stable on windows arm.
There’s close to 75% current game comparability with crossover and nearly the same with Parallels.
The partial part is there is now doubt that more games will run on more platforms now.
Editorial Comment for Lay Readers
I wanted to comment on editorial grounds since not everyone reading Techdirt (and ideally so) is going to be accustomed to the intricacies of legal jargon.
The author used the acronym “TRO” to indicate a “Temporary Restraining Order”, which was admittedly a bit confusing given I’m used to having this read as “an injunction”. Ideally, tough or lesser used acronyms should be defined (even as a footnote) for lay readers and the general public. I have been a long time reader of Techdirt for well over 10-years and plan to continue well into the future (so long as my body takes breath) as I hope for others — it has been an incredibly useful site for hard-hitting journalism in an ever accelerating and consolidating capitalist dystopian hellscape (read, arguably, in the most generous of terms so as not to alienate my own readership with my own inherent biased).
I know, unfortunately, that Techdirt lacks the sort of powerful, army of techflexing editorial staff to rope its (oftentimes legal scholars) contributors writirng on vital stories of significance to both industry and the general public.
Antitrust law being critical to maintaining an open and efficient marketplace that is free of ridiculous barriers to entry or other artificial obstructions that might harm it.
Thankfully, it’s a term that readily came up without much difficulty (thanks in major part to the likewise army of activists and scholars who have made such internet facing resources free and publicly available to anyone with an open internet connection). However, it could have equally have been a commonly used, but less easily searched term that might have thrown some readers.
I have appreciated Mike wnd other writers’ consistent transparency as part of their efforts doing journalism, often in an incredibly restrained and restricted budget—journalism forced to live on an anorexic (loss of appetite) restricted Caloric intake as though truth and good journalism were some kind of super morbidly obese cardiac and diabetes patient with congestive heart failure, and therefore needs to be managed and limited at all costs—🙄 I know, it’s a travesty to say the least—but Techdirt has consistently kept afloat and operating — thanks in great measure to our fellow generous readers who choose to give back. I want to likewise thank those people involved in the process and sing their praises.
That said — I also want to be able to toss a Techdirt article at a random, far less informed friend (only to have them scream in horror at what seemingly new horror is being doled out by corporate interests), and have them not have to run an internet search for terms (for I try not to assume everyone knows the [define] function or even, sadly, where to look up a decent dictionary online, or has easy access to dictionaries, the time, proclivity, patients, nor necessarily even the raw attention span to look such content up — I have a diverse group of friends is all I’ll say on the matter [those with a less impressive grasp on English, let alone, legalese]). I want to be able to toss articles and have them accidentally learn something while they are perusing an article (just like was my privilege upon reading the finely crafted articles of my own youth) I share.
I frequently get nitpicked about my own choice of terms, so I admit this may be an extension of my own efforts at readability, but when I (a generally well informed reader) came across an acronym that I was unacquainted with (in this case, “TRO” or “Temporary Restraining Order”), it threw me for a sec. I had to do the aforementioned web search to figure out the definition. I’m the type inclined and able to put said time into writing, so its easier for me to parse said articles. But not everyone is — even if we might like it to be otherwise.
Some might accuse me of unnecessarily trying to “dumb down” Techdirt with this comment — I don’t see it that way myself; rather, I see myself trying to help writers help their readers in what to me is a much loved periodical, or news/research/nonfiction publication. (Though, Lord knows there are those who would claim that’s all that is done here — but I try not to let my worldview be guided by the Heritage Foundation’s 2025 policy of reactionary jurisprudence.)
In future, if possible, I encourage writers at Techdirt (and editors, if Techdirt can even afford or has access to them) to try to, at least once, define either in tye article or a footnote, any acronym or particularly technical term. You’ve probably done it thousands of times before, but as my own friends remind me — journalism is supposed to assume at most a 6th grade reading capability, which itself is generous given what was expected of 6th graders’ vocabulary when those policies [or to those ardently strict journalism purists, “laws”] were first instituted into the halls of journalism well over one hundred years ago.
Anyhow, thank you Timothy and thanks to Mike and everyone at Techdirt. I appreciate everyone’s work and passion (even when it doesn’t get said nor sai$ sufficiently for the Common Good). So, here’s my metaphorical box of epic cookies to have and share with your colleagues. And while you all [?] munch away, please, take pity on your prospective readership, he says with the affirmationed now to the powers that be.
beyond the sale
It is just a video game. No one needs to play video game. Odd how antitrust has a bearing on this. Someone can develop another shooter game. Methinks this is more about who gets to watch and control the data from the players.
Re:
That’s where I’m at. Sure it’s a very large merger but at the end of the day I don’t really care since it doesn’t impact anything of substance. With the quantity of quality indie and other third party content you don’t even need to reduce video game consumption if you dislike the companies involved. I’m much more concerned about mergers of hospital systems, news media outlets, and grocery stores but there doesn’t seem to be nearly as much ink spilled over consolidation in those sectors.
Re: Re:
To you. If Microvision-Blizzard starts fucking with the AAA landscape, it’ll affect a ton of people, both development companies and players.
Re: Re: Re:
And we don’t need any more Neil Druckmanns and Bobby Koticks turning ANY industry into a worse state when they leave.
Hell, we don’t want the Druckmanns and Koticks to even ENTER in the first place, but FUCKING LINE GOES UP…
Re:
There have been supreme court cases about antitrust on baseball and other sports. This is completely on brand without getting into data, etc.
Re:
Video games are a bigger industry than tv and movies. You can’t just “make another shooter” and expect it to have the popularity or cultural impact necessary to be relevant; if you could, ATVI wouldn’t be worth 68 billion or whatever to Microsoft
Wonder when someone at the ftc will realize that 90% of the complaints about this situation essentially resolve to “OH noes!! Someone other than Sony is gonna own a “Must Have” game or two!”
Antitrust: It’s only bad when it’s the second guy doing it.
compliance
Microsoft changed contracts not to evade the lawsuit, but to come into compliance with your implied requirements.
Fact chexk
The only potentially people harmed by this deal are Sony users. Given Sony has an ever shrinking list of developers, it’s only a tiny possibility this deal will change anything. Other than bringing games to 4 more platforms, that is.
View in chronology
Your emphasis on making technical and legal content accessible to a broader audience is well-founded, and your call for defining terms, like acronyms, exemplifies a thoughtful approach to ensuring inclusive journalism.