US Regulator Files Appeal Against $69 Billion Microsoft-Activision Acquisition Deal

United States regulator, the Federal Trade Commission (FTC), has filed an appeal against Microsoft and Activision's $69 billion acquisition deal.

The filing is the latest development and brings new challenges against Microsoft's plan to purchase the game's publisher. The FTC's request earlier this week that sought to block the takeover plan was rejected by a San Francisco district judge.

US Regulator Appeals Microsoft-Activision Acquisition Deal

The massive multi-billion dollar deal that the technology giant put forth to buy the maker of the massively popular "Call of Duty" franchise has become one of the biggest of its kind in the history of the gaming industry.

In response, Microsoft said it plans to fight the FTC's appeal to its acquisition deal with Activision. In a statement, the president of the tech giant, Brad Smith, said that they were disappointed that the regulator was continuing its pursuance of what he called has become a demonstrably weak case, as per BBC.

On the other hand, the regulator alleged that the massive acquisition deal would only harm gamers and reduce competition by giving Microsoft, the maker of Xbox, enough power to deny rivals any access to Activision's games.

The FTC has been seeking an emergency ruling to stop the deal from finalizing while challenging the planned takeover. On Tuesday, US District Judge Jacqueline Scott Corley said that she did not think the US regulator would be able to win the case against Microsoft.

She added that the FTC has yet to show that the combination of Microsoft and Activision would result in pulling Call of Duty from Sony PlayStation. The judge also said that it has yet to show that acquiring the games publisher's content would substantially reduce competition in the video game library subscription and cloud gaming markets.

On the other hand, Smith said that the District Court's ruling only showed that the acquisition deal would be good for both competition and consumers. Additionally, Activision Blizzard's CCO and EVP of corporate affairs, Lulu Cheng Meservey, posted on Twitter that "The facts haven't changed," according to The Verge.

Effects of the $69 Billion Merger

She noted that they are confident that the United States will remain among the 39 countries where the merger between Microsoft and Activision can close. The president of Blizzard Entertainment, Mike Ybarra, also quipped about the appeal on Twitter, saying, "Your tax dollars at work."

Despite the US regulator's arguments against the acquisition, some believe the deal would positively impact all parties involved, Call of Duty and its player base. For a while, the game has been facing criticism over design decisions prioritizing monetization over players' experience.

With Microsoft taking the helm, the tech giant could allow the game's developers to set aside super-aggressive monetization decisions and instead focus on features that would benefit players and the game. Additionally, under Activision, Call of Duty has failed to deliver to expectations in recent years, and new leadership could change the situation for the better, said the Inverse.