Microsoft’s Landmark Activision Blizzard Acquisition: The Regulatory Odyssey

In an industry that is no stranger to large-scale consolidation and high-stakes acquisitions, Microsoft’s bid to acquire Activision Blizzard for $68.7 billion is a move of unprecedented magnitude. The landmark acquisition would not only reshape the global gaming landscape but also represent the largest deal in Microsoft’s history. However, the journey toward regulatory approval has proven to be a complex and challenging one.

A Unifying Vision

On the surface, Microsoft’s ambition is to create a gaming ecosystem that extends the joy and community of gaming to everyone on the planet. As part of this vision, Activision Blizzard’s extensive portfolio, which includes franchises like Call of Duty, World of Warcraft, and Candy Crush, would enhance the appeal of Microsoft’s Xbox Game Pass and PC Game Pass, bringing more titles to the platform’s subscribers.

Furthermore, the acquisition is positioned to accelerate Microsoft’s plans for cloud gaming, a burgeoning market with vast potential for expansion and growth. Through this merger, Microsoft envisions greater inclusivity within gaming, leveraging Activision Blizzard’s broad-ranging franchises and Microsoft’s own technological prowess to bring more people into the gaming community across a variety of platforms and devices.

Regulatory Hurdles: A Transatlantic Odyssey

While the deal’s financial and strategic implications are substantial, the quest for regulatory approval has proven to be a complex game of its own, providing a compelling narrative of transatlantic regulatory dynamics. In Europe, Microsoft cleared the first hurdle with the EU providing its blessing. However, in the United Kingdom, the Competition and Markets Authority (CMA) initially put a spanner in the works by blocking the acquisition over antitrust concerns.

Significant concerns revolved around the possibility of Microsoft making Call of Duty, one of the most popular franchises under Activision Blizzard, exclusive to Xbox. This fear was somewhat allayed when updated data analysis led the CMA to provisionally conclude that such a move would not be in Microsoft’s interest, as the cost to Microsoft of withholding Call of Duty from PlayStation would outweigh any gains.

On the other side of the Atlantic, in San Francisco, a federal judge has dismissed an effort by the Federal Trade Commission (FTC) to halt Microsoft’s proposed acquisition of the video game giant, Activision Blizzard, by means of a preliminary injunction, according to CNBC.

However, this decision doesn’t guarantee a smooth path to the acquisition. The FTC still holds the option to contest the judgment at the U.S. Court of Appeals for the 9th Circuit. Furthermore, Microsoft and Activision Blizzard need to devise a strategy to mitigate the resistance posed by the United Kingdom’s Competition and Markets Authority.

Judge Jacqueline Scott Corley found that the FTC had not shown a likelihood of succeeding in its claim that the merger would significantly lessen competition. Rather, she suggested that the deal could lead to more consumer access to Call of Duty and other Activision content, thereby denying the motion for a preliminary injunction.

Impact on Share Values and Industry Sentiment

The decision by the District Court for the Northern District of California, is an incredibly significant one because it rejects the FTC’s attempt to prevent the merger, thereby paving the way for Microsoft’s acquisition to proceed. The landmark ruling generated a wave of optimism from both companies, as they inferred that it could signal a path towards full global regulatory approval.

FTC’s Knee-Jerk Reaction

Despite the positive ruling in the U.S., the future of the deal is far from settled. The FTC has remained determined in its resistance to Microsoft’s proposed $68.7 billion acquisition of Activision Blizzard. Following the judge’s dismissal of their request for a preliminary injunction, the FTC took prompt action, filing an appeal against the ruling in their continuous efforts to halt the deal. It initiated an appeal process against the federal judge’s ruling which declined their application for a preliminary injunction that could have stopped the acquisition from being finalized.


The Microsoft-Activision Blizzard merger is a watershed moment in the gaming industry, representing the ongoing consolidation in the sector. The case is a fascinating study of the interplay between corporate ambition, regulatory safeguards, and the evolution of a rapidly changing industry. The outcome of this acquisition will have far-reaching implications for the gaming industry, potentially setting the stage for the sector’s future dynamics and growth.

Opinion – The Great Consolidation of the Gaming Industry – Risks, Perils, and Promises

The gaming industry, once a dispersed field of independent studios and small-scale enterprises, has been undergoing a seismic shift. The rise of conglomerates and the subsequent consolidation trend represents a new era of gaming — one that is reshaping the landscape with a mix of potential benefits and perceived risks.

The Microsoft-Activision Blizzard deal is a prime example of this trend, an industry titan attempting to absorb a major player, and in doing so, creating a monolith that could redefine the norms of the industry. The acquisition could bring about several advantages.


Increased Accessibility and Integration

Consolidation often leads to increased accessibility and integration, as games are bundled together in subscription services like Xbox Game Pass, which currently boasts more than 25 million subscribers. With more games available in one place, users gain access to a broader range of titles at a lower cost than purchasing each game individually.

Better Game Development Resources

As smaller studios come under the umbrella of larger companies, they gain access to better resources and technology. This could result in higher quality games, more innovative gameplay, and more consistent updates and improvements.

Improved Financial Stability

Financial stability is another perk. Gaming is by some, still considered a high-risk industry, with the success of a game never guaranteed. Having the backing of a large company can provide a safety net that allows developers to take more creative risks.

However, as with any major shift, there are significant concerns.


Potential Loss of Creative Independence

One of the primary worries is the potential loss of creative independence. Larger companies may impose their visions on smaller studios, which could stifle originality and lead to a more homogenized gaming landscape.

Anti-Competitive Behaviour

Then there’s the fear of anti-competitive behavior. As fewer companies control more of the market, there’s a risk of monopoly power. This could result in higher prices for consumers, less choice in the market, and potentially less motivation for companies to innovate.

Implications for Employment

Finally, there are implications for employment. Consolidation can lead to job losses as roles are duplicated and economies of scale come into play.

Yet, despite these concerns, there’s an undeniable sense of promise. Microsoft’s commitment to honoring individual studio cultures and promoting inclusion could serve as a blueprint for other corporations considering similar acquisitions. And while there’s a legitimate fear of monopolies, robust regulatory oversight, as seen in the UK’s Competition and Markets Authority’s intervention, ensures that checks and balances remain.

As we navigate this evolving terrain, it’s vital to keep the dialogue open about the merits and perils of consolidation. The gaming industry, in its dynamic and vibrant character, has always been about pushing boundaries. As we stand at the precipice of this new era, let’s ensure that whatever form consolidation takes, it should serve to enrich our gaming experiences, not diminish them.