Earlier today, the Federal court ruled in favor of Microsoft allowing the Redmond giant to proceed forward with the Activision acquisition. In case you need a refresher, early last year, Microsoft had announced its decision to acquire Activision for a whooping $68.9 million. However, the deal had raised many eyebrows with UK's CMA and US's FTC rushing to block the acquisition.
However, today, Microsoft received the green light in the US as the Federal judge sided with Microsoft, allowing the company to move forward with the acquisition. Soon after, Xbox chief Phil Spencer sent out a company wide internal memo addressing the concerns and doubts surrounding the acquisition.
Today a US District Court judge issued a decision denying the Federal Trade Commission’s request for a preliminary injunction, which would have temporarily blocked our acquisition of Activision Blizzard from closing in the United States. We’re grateful that, upon a review of the evidence and witness testimony, the Court rejected the FTC’s claims that our acquisition would harm consumers.
In the memo, Phil addressed the win in the US and the switch in focus towards the UK. Soon after the ruling against FTC, the CMA in the UK announced that it will pause the litigation against Microsoft to work with the company and negotiate a possible solution.
After today’s decision, we are turning our focus to the UK. As you may be aware, a few months ago, the UK Competition and Markets Authority recommended that the deal be prohibited. We disagree with the CMA’s concerns and have challenged its decision on appeal.
He further noted, that the company always believed that the Activision Blizzard acquisition will be beneficial for the gaming community and the industry in general. He also touched upon Microsoft's commitment to making games more accessible to users worldwide.
From the beginning, the Gaming Leadership Team and I have believed that this acquisition will meaningfully benefit players and the gaming industry. Since we announced our intent, our actions have demonstrated our commitment to bringing more games to more people on more devices. This includes numerous signed agreements to make Activision Blizzard’s games, Xbox first party games and Game Pass all available to more players than they are today.
Phil closed the memo by thanking employees for assisting with the acquisition. You can read the full memo below:
Today a US District Court judge issued a decision denying the Federal Trade Commission’s request for a preliminary injunction, which would have temporarily blocked our acquisition of Activision Blizzard from closing in the United States. We’re grateful that, upon a review of the evidence and witness testimony, the Court rejected the FTC’s claims that our acquisition would harm consumers. The evidence showed the deal is good for the industry and that the FTC’s claims about console switching, multi-game subscription services, and the cloud do not reflect the realities of the gaming market.
After today’s decision, we are turning our focus to the UK. As you may be aware, a few months ago, the UK Competition and Markets Authority recommended that the deal be prohibited. We disagree with the CMA’s concerns and have challenged its decision on appeal. At the same time, however, we are considering how the transaction might be modified to address the CMA’s concerns in a way that is acceptable to the CMA. In order to prioritize work on potential options, Microsoft and Activision have agreed with the CMA that pausing the appeal now would be in the public interest, and both we and the CMA have made a joint submission to the Competition Appeal Tribunal to this effect.
From the beginning, the Gaming Leadership Team and I have believed that this acquisition will meaningfully benefit players and the gaming industry. Since we announced our intent, our actions have demonstrated our commitment to bringing more games to more people on more devices. This includes numerous signed agreements to make Activision Blizzard’s games, Xbox first party games and Game Pass all available to more players than they are today. I’m proud of our efforts to expand player access and choice throughout the process. This deal has already been cleared to move forward in 38 countries, and we will continue to work toward timely resolution in other jurisdictions.
Thank you to everyone who has devoted their time and dedication in support of our acquisition. We embarked on this deal with a clear vision for meeting players where they are, and with today’s decision by the Court, we take an important step forward in bringing this vision to life.
Phil
With the win in the US, Microsoft now has one major huddle left in the UK. The CMA had mentioned earlier that the acquisition would establish Microsoft as a major player in the cloud gaming market. With that in mind, the UK regulators were not comfortable in letting Microsoft move forward with the acquisition.
While the UK is not happy with the deal, other countries like Ukraine, Brazil, China, South Africa and Japan have approved the deal. Activision, on the other hand, had confirmed earlier that it had hired a top lawyer to appeal the UK's decision to reject the deal.
Source: The Verge
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