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Microsoft and Activision Blizzard filed their formal responses earlier to the FTC’s anti-competitive lawsuit against Microsoft’s acquisition of Activision Blizzard, emphasizing that Microsoft’s acquisition of Activision Blizzard will not only reduce competition, but consumers will benefit more . “The Commission (referring to the FTC) could not demonstrate that this deal would be detrimental to consumers because it would in fact allow consumers to play games on more new platforms at a cheaper price,” Microsoft wrote.
The key to the entire lawsuit is that the FTC believes that Microsoft will “lock” the games produced by Activision Blizzard on Microsoft’s own Xbox console and cloud game service, and pointed out that Microsoft currently has plans to put three Bethesda (Microsoft bought last year) Microsoft doesn’t deny that games from its parent company, ZeniMax, are locked on the Xbox platform. The game that Microsoft uses as a counterexample is the very popular “Call of Duty” series. Here, Microsoft promises to keep Call of Duty cross-platform for at least 10 years and bring it to the Nintendo platform. . Sony seems to have little interest in it.
Microsoft’s main opinion is that “a single game company bought by a third-place game console company will not be able to shake the highly competitive game industry, especially since the console company has repeatedly emphasized that it does not intend to limit games to its own platform. superior”. Both Microsoft and Activision Blizzard said that tying series such as “Calling Moment” to a single platform is not good for revenue, because it will not only lose billions of dollars in game revenue, but also lose a lot of loyal fans. player. “In an industry with nearly limitless alternatives, limiting Call of Duty to a single platform is not a viable option.”
In addition, Microsoft also has an opinion on the fact that the FTC can bring an anticompetitive lawsuit. The FTC is the “player and referee” here, not only the objector, but also the arbiter who ultimately decides whether to let it go. Microsoft believes that this violates the basic principle of legal process that the ruling should be conducted by a neutral party, and that the FTC should have filed the lawsuit in federal court, not the FTC’s own administrative tribunal.
But even so, Microsoft is not opposed to letting the FTC put forward conditions, as long as the FTC stamps and releases, everything is easy to say. Brad Smith, president and deputy director of Microsoft, said that although Microsoft has confidence in itself, as long as it can protect competition, consumers and employees, Microsoft can continue to discuss various solutions with relevant units.
The current agreement between Microsoft and Activision Blizzard is to complete the acquisition by July, otherwise the two parties will have to renegotiate the content of the acquisition, or even give up the acquisition. In the latter case, Microsoft may have to pay up to $3 billion in liquidated damages. However, the FTC’s anti-competitive case will not be heard until August 2, so it seems that if Microsoft and Activision Blizzard are both interested in proceeding with the acquisition, it is necessary to renegotiate the content of the acquisition. Not only in the United States, the two companies are also facing scrutiny from relevant authorities in the European Union and the United Kingdom. The two companies are expected to give relevant judgments in the first half of 2023.
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