The EU Commission has issued a statement refuting one of the United States Federal Trade Commission's key claims listed as justification for blocking Microsoft's acquisition of Activision Blizzard. On Thursday, the FTC shared a public complaint claiming Microsoft's Activision Blizzard acquisition was "reasonably likely to substantially lessen competition or tend to create a monopoly." Apparently, the accuracy of part of the FTC's claims against Microsoft has prompted a correction from the EU Commission.
During Microsoft's acquisition of ZeniMax Media, which closed in 2021, the European Commission executed a thorough antitrust review. The FTC wrote in its complaint that during this review Microsoft told the commission it, "would not have the incentive to withhold ZeniMax titles from rival consoles." This assurance, according to the FTC, was quickly reversed by Microsoft once the acquisition was cleared by the European Commission. Specifically, Microsoft announced that Starfield, Redfall, and Elder Scrolls 6 would be, according to the FTC, "Microsoft exclusives."
In a statement issued to MLex Market Insight, the European Commission has clarified that Microsoft made no such commitment as part of the antitrust review. More specifically, the commission explained that it, "cleared the Microsoft/ZeniMax transaction unconditionally," and further that the commission concluded that, "the transaction would not raise competition concerns." Addressing the FTC's specific claim regarding Microsoft making ZeniMax Media games exclusive, the commission says that its review considered just such a possibility and decided that it would not have a significant impact on competition since other companies would still have a "large array" of content available to them.
There are effectively two refutations in what the European Commission has clarified. The first is that Microsoft did not lie or go back on a commitment. The second is that the anti-competitive behavior the FTC says Microsoft wasn't honest about wasn't anti-competitive at all. What's one of the FTC's key justifications for its complaint to block Microsoft's acquisition of Activision Blizzard was dismantled by the EU Commission.
The European Commission's statement doesn't actually change anything regarding Microsoft's acquisition of Activision Blizzard or the FTC's effort to thwart it. Microsoft will be able to use the commission's statement in court if it comes to that, but that's unlikely to happen until June or August 2023, depending on other factors. Before then, Microsoft still needs approval from the European Commission. It may have approved the ZeniMax acquisition, but Activision Blizzard is another matter entirely.
Microsoft's road to closing the acquisition of Activision Blizzard remains long and complex. It certainly doesn't help when the FTC is using inaccurate justifications in an effort to block Microsoft, though. Microsoft should get its day in court eventually, at which point the FTC will have to explain its claims before a judge.
Source: MLex (via ResetEra)