Just moments ago, a California Judge ruled that Microsoft may proceed with its $69 billion acquisition of Activison/Blizzard ahead of the July 18th deadline. While not the true end of all the legal hurdles for Microsoft, the deal is now more a reality than ever. This ruling denies the FTC (Federal Trade Commission of the United States) request for a preliminary injunction to halt the deal. What it doesn't do is stop the FTC from pursuing its antitrust case. There is also the matter of the UK CMA (Competition and Markets Authority) ruling earlier this year, blocking the deal. With the ruling today, we will have to see if this make the CMA more open to negotiations, as it would be the only hold out if the FTC were to truly lose its case.
Just after the ruling came down, Brad Smith (Microsoft President), Phil Spencer (Head of Xbox) and Bobby Kotick (CEO of Activison/Blizzard) with the following statements.
“Our merger will benefit consumers and workers. It will enable competition rather than allow entrenched market leaders to continue to dominate our rapidly growing industry.” ~Bobby Kotick (CEO of Activison/Blizzard).
Implications
In the lead up to the decision today, Microsoft had made several commitments revolving around the hotly fought over Call of Duty franchise (developed and published by Activison Blizzard). With those commitments made, Judge Corley had this to say in the ruling:
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 10 years on parity with Xbox. It made an agreement with Nintendo to bring Call of Duty to Switch. And it entered several agreements to for the first time bring Activision’s content to several cloud gaming services. This Court’s responsibility in this case is narrow. It is to decide if, notwithstanding these current circumstances, the merger should be halted—perhaps even terminated—pending resolution of the FTC administrative action. For the reasons explained, the Court finds the FTC has not shown a likelihood it will prevail on its claim this particular vertical merger in this specific industry may substantially lessen competition. To the contrary, the record evidence points to more consumer access to Call of Duty and other Activision content. The motion for a preliminary injunction is therefore DENIED.
With this, Switch users will gain access to Call of Duty. PlayStation will have a guaranteed 10-year commitment to the franchise. Activision/Blizzard games will also be available on other cloud services. It has been stated multiple times in the past that Blizzard's games (Starcraft, World of Warcraft, Diablo, etc.) would not be joining Microsoft's cloud service. However, with today's ruling, who knows what the future holds.
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