Gamers are suing Microsoft to thwart its merger with ActivisionThank you for reading this post, don't forget to subscribe!
The Clayton Antitrust Act of 1914 gives Americans the right to sue companies for anti-competitive behavior, a fact that 10 self-described gamers are using to take Microsoft to court, aiming to stop the company’s acquisition of Activision.
Like reported by Bloomberg’s Lawthe complaint filed today and received by my citystates that the plaintiffs, or “video game players” as they are described, are concerned that “ [Microsoft and Activision] the merger would substantially lessen competition or create a monopoly;” such a merger, the complaint states, would specifically violate Section 7 of the Clayton Act, which states that acquisitions that lessen competition are prohibited under U.S. antitrust law . Not only does the complaint cite the scale and scope of the Activision-Microsoft merger as problematic, but also that this latest proposed merger follows a slew of other Microsoft acquisitions, ranging from the 2014 purchase of Mojang to the 2022 acquisition of Rare.
Broadly outlining console, PC, and AAA games, as well as subscription services as “Relevant Product Markets,” the lawsuit calls attention to how many major franchises will fall under Microsoft’s corporate umbrella if the merger goes through. Call of Duty, World of Warcraft, Minecraft, doom, Microsoft Flight Simulator, haloand The Elder Scrolls are only some of the cited examples. He maintains that Microsoft and Activision currently compete directly through these titles and services such as Battle.net, the Microsoft Store and Game Pass. A merger would destroy this competitive dynamic.
If the merger goes through, the suit claims, Microsoft would have “enormous market power and the ability to foreclose key inputs for competitors and further harm competition.” The suit mentions competition as it pertains to consumer sales as well as industry competition to “recruit and retain talent within the dedicated video game workforce” that would be “reduced” in the merger.
my city has reached out to Microsoft for comment.
The proposed MIcrosoft / Activision merger has been a lightning rod for controversy ever since its initial announcement. Perhaps most troubling for Microsoft is the recently filed suit by the FTC. The feds argue that if the merger goes through, it would seriously harm competition in the video game industry, citing Microsoft’s past behavior of prioritizing Xbox and Windows PC as platforms for its games. Microsoft disagreed, saying that the Activision acquisition would “bring Call of Duty for more gamers and more platforms than ever before.”
Speaking of Call of Dutyin response to criticism of the planned merger with Activision, Microsoft has promised to continue to deliver Call of Duty to other platforms for at least 10 years. Microsoft Gaming CEO Phil Spencer has categorizes criticism of Sony of the acquisition as an attempt to “protect its console dominance” and that it is looking to grow by “downsizing Xbox.”
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