Microsoft’s $69 billion deal to acquire Activision Blizzard is still on, after a San Francisco judge ruled in its favor Tuesday morning.
Judge Jacqueline Scott Corley wrote in a 53-paged opinion that the U.S. Federal Trade Commission had not proven that Microsoft would pull Call of Duty from PlayStation or that owning Activision would hurt competition in gaming subscription or cloud gaming markets.
Corley wrote, “Microsoft’s acquisition of Activision has been described as the largest in tech history. It deserves scrutiny. That scrutiny has paid off: Microsoft has committed in writing, in public, and in court to keep Call of Duty on PlayStation for ten years on parity with Xbox.”
The deal was first announced in January 2022. Microsoft wants to buy Activision Blizzard for its mobile gaming dominance (Candy Crush, Call of Duty) and its portfolio of popular games (COD, World of Warcraft, Diablo). Activision CEO Kotick negotiated the deal after months of headlines about the company’s sexual harassment lawsuits. If the deal is completed, Kotick stands to earn about $400 million.
The FTC argued that the deal would hurt Sony’s business and affect consumers, and pointed to the success and dominance of Call of Duty as an example.
The temporary restraining order will dissolve on Friday unless the FTC is able to appeal. FTC spokesperson Douglas Farrar said in a statement: “In the coming days we'll be announcing our next step to continue our fight to preserve competition and protect consumers.”
The decision did not surprise the many analysts interviewed by Updater. The FTC has been taking an aggressive stance against tech giants and was not expected to win.
Those who were in opposition to the deal called for an appeal of the decision. Some noted that the judge had a son employed with Microsoft, which could be a potential conflict of interest.
Below, we’ll dive into the specifics of how the judge made her decision, and a special look back at Microsoft’s 1998 antitrust case. This newsletter is paywalled but will unlock in two days for free subscribers, so please subscribe and stay tuned to read more.