US District Judge Jacqueline Scott Corley said in a ruling that “the Federal Trade Commission (FTC) has not established that this merger could significantly impair competition in this particular industry.” On the contrary, the available evidence indicates that Consumers have more access to Call of Duty and other Activision content.
Microsoft appeared to have the upper hand in a five-day court hearing in San Francisco that ended late last month. At the hearing, there were statements from Microsoft CEO Satya Nadella and longtime Activision Blizzard CEO Bobby Kotick, both of whom pledged to bring back Activision’s hit game Call of Duty, available to people who play it on consoles — specifically Sony’s PlayStation — those with Microsoft’s Xbox compete. “Our merger will benefit consumers and workers. “It will allow competition, rather than allowing established market leaders to continue dominating our growing industry,” Activision CEO Bobby Kotick said in a written statement.
Activision Blizzard Inc. shares rose 5% after the decision.
The FTC had asked Judge Corley to issue an injunction to temporarily block the Activision purchase until the FTC could consider it in a proceeding in August.
The two companies mentioned that such a delay would force them to abandon the acquisition agreement signed nearly 18 months ago. Microsoft has promised to pay Activision a $3 billion infringement fee if the deal doesn’t close by July 18.
Another judge rejected the FTC’s attempt earlier this year to block Meta from buying up Within Unlimited. Ms. Corley expressed skepticism about the FTC’s case during the trial, particularly regarding the hypothetical harm that would result if Microsoft pulled Call of Duty from competing platforms or offered a poor experience on competing consoles.
“It all boils down to Call of Duty again,” she added. “We’re here for Call of Duty.”
Near the end of the hearing, Judge Corley said the FTC had already won a consumer victory because Microsoft promised certain competitors it would ease the deal with Activision Blizzard.
As investigations and litigation mount in the United States and around the world, Microsoft has committed to making Call of Duty available on the Nintendo Switch console, Nvidia’s gaming service, and other platforms for at least less than a decade.
“In a way, you won,” Ms. Corley countered to the FTC’s lead counsel in the case, James Weingarten.
“I don’t think we won,” Weingarten countered, saying there was no evidence that “rushed” contracts adequately protected the market. Several other countries and the European Union have approved the acquisition of Activision Blizzard, but it is still being challenged by the UK’s Competition and Markets Authority. Microsoft is appealing the UK regulator’s decision to block the deal, and a court hearing on the matter is due to begin later this month.
Canadian regulators are also investigating the transaction and have concluded that it “poses a risk of preventing or reducing competition in gaming consoles and subscription services,” according to a letter to Microsoft filed in the U.S. case late last month became.