The investigation is still ongoing, but many of the heavyweights have been completed, people familiar with the investigation said, including depositions from Microsoft CEO Satya Nadella and Activision President Bobby Kotec. The people, who have all been granted anonymity to discuss a confidential matter, said that if the agency moves forward with a case, it could be brought forward as soon as the next month.
A primary concern for the FTC is whether the acquisition of Activision would give Microsoft an unfair boost in the video game market. Microsoft’s Xbox is the third industry leader in Sony Interactive Entertainment’s PlayStation console list. However, Sony has emerged as the primary opponent to the deal, telling the FTC and regulators in other countries that if Microsoft makes hit games like Call of Duty exclusively for their platforms, Sony will be at a significant disadvantage.
The Federal Trade Commission declined to comment.
In an October statement to the UK’s Competition and Markets Authority outlining Sony’s position, and published on Wednesday, Sony said the deal would not only hurt its ability to compete, but also leave consumers with fewer choices for games and developers with fewer choices of where to publish. Toys. Sony said Microsoft is “a titan that buys irreplaceable content at unquestionable prices ($68.7 billion) to drive the competition to itself.”
In its own statement, also released by the British regulator on Wednesday, Microsoft accuses Sony of making self-serving statements to maintain its number one position in gaming. “The suggestion that the market leader, Sony, with clear and enduring market power, could be shut out by the smallest of the three console competitors, Xbox, as a result of losing access to a single title, is not credible.”
Microsoft said it has repeatedly promised to keep Call of Duty available on Sony’s PlayStation, moreover, the game isn’t as essential as Sony says. Additionally, Microsoft notes that the game is not currently available on any subscription service, and adding it to the Xbox service in the future wouldn’t hurt Sony.
To a lesser extent, Google is also opposed to the deal, according to two people familiar with the matter. The company argued that Microsoft had intentionally lowered the quality of its Game Pass subscription service when used with Google’s Chrome OS, and that owning Activision would boost its incentive to do so, ultimately steering hardware sales toward Microsoft and away from Google, the people said. .
Google is a minor player in the gaming industry and is canceling its online gaming service Stadia. However, he is under worldwide antitrust scrutiny, including for behavior in the gaming market, and is unlikely to be a sympathetic opponent. Fortnite maker Epic Games is currently suing Google, arguing that it is illegally blocking Fortnite from the Google Play mobile app store. As part of that case, Epic recently accused Google of paying Activision $360 million for not offering a competing App Store on Android phones.
A Google spokesperson declined to comment.
Microsoft has vowed to keep Call of Duty available on Sony’s Playstation console, and recently made an offer to give Sony access to the game for the next 10 years. The show was first reported by The New York Times. It is not known how Sony has responded to the offer and did not respond to comment on Wednesday.
However, the FTC’s concerns go beyond Call of Duty, and investigators are trying to determine how Microsoft could leverage future unannounced titles to boost its gaming business, according to two people familiar with the review.
“Any suggestion that a transaction could lead to adverse effects is completely absurd. We are committed to continuing to work collaboratively with regulators around the world to allow the transaction to move forward, but we will not hesitate to fight to defend the deal,” Activision spokesman Joe Christinat said. if it is necessary.”
Activision also disputes Epic’s claims. “Epic’s allegations are nonsense,” Christinat said. “We can confirm that Google has never asked, pressured or made us agree not to compete with Google Play – and we have already provided documents and certifications to prove it.”
Microsoft spokesperson David Cody said the company is “prepared to address the concerns of regulators, including the FTC and Sony, to ensure the deal closes with confidence. We will continue to track Sony and Tencent in the market after the deal closes, and Activision and Xbox together will benefit gamers and developers and make the industry more capable.” on the competition.”
The FTC technically does not have to take any action at this point. Regulators in Europe and the UK also recently opened in-depth investigations, meaning the companies weren’t able to close the deal until spring at the earliest. This means that if the FTC files a lawsuit, it will likely file a case in its own internal administrative court.
The agency usually first challenges the deals in federal court to block them through a temporary injunction pending trial in the inner court. Without imminent danger of closing the deal, it would be difficult to obtain a temporary injunction.
The companies have until July next year to close the deal without renegotiating the agreement. An administrative lawsuit filed later this year or in January is unlikely to be resolved by July and could force the companies to abandon the deal.