Another antitrust lawsuit was filed against Microsoft, this time by players who wanted to stop the computer giant’s $69 billion acquisition bid of Activision Blizzard.
According to the lawsuit, which was filed on Tuesday in federal court in California, the agreement will stifle competition in the gambling sector. Less than two weeks prior, the Federal Trade Commission filed a lawsuit to prevent Microsoft from finalizing the biggest purchase in the history of the video gaming industry.
“If Microsoft’s proposed acquisition of Activision Blizzard is allowed to proceed, the video game industry may lose a substantial competition, and Microsoft may have far-outsized market power, with the ability to foreclose rivals, limit output, reduce consumer choice, raise prices, and further inhibit competition,” reads the complaint.
The merger, in response, will “increase competition and generate more options for gamers and game developers as we attempt to bring more games to more people,” a Microsoft representative said in a statement. The business will litigate to have the transaction approved.
If approved, the merger will unite Activision, the publisher of Call of Duty, Warcraft, and Candy Crush, with Microsoft, which controls the Xbox platform, a game streaming service, and the most widely used personal computer operating system in the world.
The lawsuit asserts that the combination will create one of the biggest video gaming corporations with the power to hurt potential rivals. It was filed on behalf of ten gamers in California, New Jersey, and New Mexico. Microsoft might, for instance, make its games Xbox-only.
Microsoft offered Sony a 10-year contract in November to maintain Call of Duty on PlayStation prior to the FTC’s lawsuit. In a last-ditch effort to get permission, it then declared that it had signed an agreement with Nintendo to release the first-person shooter on Nintendo platforms if the deal was complete.
Microsoft will probably contend that its suggested remedies take care of any potential harm to the market.
The lawsuit, however, asserts that the company’s proposals fail to take into account possibilities such as decreasing the quality of games on other platforms, making some features exclusive to Xbox, or releasing Activision games on competing consoles at a later date than Xbox.
According to the complaint, Microsoft might likewise block access to Activision material on competing operating systems. Activision now creates all of its games for both Mac and Windows, but this may change in the future.
In spite of promising European competition regulators that it wouldn’t restrict ZeniMax games on competitor consoles, Microsoft made one of its most well-known games, Starfield, exclusive to Xbox and Windows after purchasing ZeniMax Media in 2020.
Gamers contend that in addition to hurting customers, the proposed merger will lessen competition for workers in the video game business. The lawsuit asserts that Microsoft will have excessive market power in recruiting and retaining employees and that people will have far fewer employer options.
Activision is now defending itself against lawsuits brought by staff members and the California Department of Fair Employment and Housing that claim the company engaged in widespread sexual harassment and gender discrimination.
