The US Federal Trade Commission’s (FTC) decision to drop its case against Microsoft ‘s acquisition of Activision Blizzard brings to a close the months-long regulatory dispute surrounding the biggest deal in the history of the games industry. Thus, the $69 billion purchase of the ‘Call of Duty’ maker not only remains in place, but becomes a turning point for the way US regulators treat mega-mergers in the technology sector.
For Microsoft, this is not only a formal sealing of the 2023 deal. It’s also proof that a strategy of patiently waiting out opposition from regulators can pay off. The FTC tried to block the acquisition, arguing that it gave Microsoft too much control over the console, subscription and cloud gaming markets. However, after losing an appeal in May and a change in priorities by the new leadership, the agency dropped further action.
The FTC’s new chairman, Andrew Ferguson, is clearly veering away from the course set by Lina Khan, who was known for her more aggressive approach to market concentration in Big Tech. The move away from ‘Microsoft-Activision’ type cases signals a shift in the agency’s focus towards more politically resonant issues, such as the alleged collusion of advertisers limiting spending on Platform X.
In practice, this means that technology giants, if they show enough determination and patience, can increasingly push through their mergers, even those of a potentially anti-competitive nature. It is also hard not to notice that Microsoft has managed not only to finalise the deal, but also to stabilise the situation around it – both in terms of media and regulation – which may influence the decisions of other players, such as Amazon or Google, looking at their own acquisitions.
However, this is not the end of questions about the long-term impact of this merger. Will Microsoft use the acquisition to further consolidate the market? Will other bodies – such as the European Union – maintain a more restrictive stance? One thing is certain: a precedent has been set, and the landscape of gaming – and technology oversight – will never be the same again.
