The US Federal Trade Commission is reportedly planning to withdraw its case against Microsoft $69 billion acquisition of game publisher Activision Blizzardbringing the Xbox maker another step closer to closing the deal.
Federal Trade Commission Secretary April Tabor on Thursday ordered a stay on the case that was scheduled to hear before the agency’s administrative law judge Aug. 2, according to a report From Reuters. This comes a week after the FTC lost its appeal in federal court to temporarily block the Microsoft-Activision deal from proceeding until the commission’s administrative law process is over.
Microsoft revealed it for the first time Plans to acquire Activision in January 2022. Closing the deal would turn Xbox manufacturer Microsoft into one of the top three video game publishers, right behind rival Sony. Activision Blizzard is one of the largest third-party publishers, with some major franchises that would give a much-needed boost to Microsoft’s game catalog, including Call of Duty, Candy Crush, and Overwatch.
Microsoft until October 18th to end its deal with Activision. Both companies moved the deadline back to October from the original July 18 date, allowing more time to get approval from regulators. If the deal is not finalized, there is a termination fee, or “break-up fee”, paid by Microsoft to Activision. The fee is $3 billion, but it will rise to $3.5 billion on Aug. 29 and then $4.5 billion if the deal is not completed by Sept. 15. Tweet on Wed The companies are “confident in our prospects for getting this deal across the finish line”.
Although Microsoft has won some merger battles, it still has hurdles to clear. Here’s what you need to know about the deal and what it means for players.
Who is left to agree to the deal?
Microsoft still needs to convince UK regulators to sign off on the takeover. In April, the UK Competition and Markets Authority Bar deal $69 billionsaying it would lead to higher prices and fewer options for players.
Microsoft’s appeal for the ruling says that the CMA “made material errors in its calculation and assessment of market share data for cloud gaming services by failing to consider limitations from original games (where players access games installed on their devices through a digital download or a physical disc).”
According to Reuters.
In the United States, the Federal Trade Commission opposed the deal, saying that the acquisition would hurt competition within the video game industry. So far, however, legal challenges have been unsuccessful.
Earlier this month, a federal judge refused to issue a preliminary injunction that would have temporarily halted the deal. The Federal Trade Commission was trying to stop the merger until a separate internal administrative trial could take place. Now, the Federal Trade Commission is reportedly planning to delay the case. In the past, the FTC dropped its opposition to deals if a federal judge denied an injunction.
Microsoft continued to deny that the deal would hinder competition within the video game industry. It has already obtained approval from the European Union, China, Japan and other major countries.
What does this deal mean for players?
to Xbox Game Pass subscribersThe merger will mean that Activision Blizzard’s catalog of games will be integrated into the service, likely similar to how Bethesda games were when Microsoft acquired that company in 2020.
How-to for gamers who don’t have an Xbox, and instead are using Sony Playstation or Nintendo Switch console, will be less noticeable affected. Critics of the deal worry that Microsoft may make future games developed by Activision unavailable on competing consoles. (Microsoft has done this for games developed by Bethesda.) This is especially true for a major Activision title like Call of Duty.
Microsoft has already agreed to a 10-year deal with Nintendo to bring Call of Duty games to its consolesbut Sony reportedly rejected a similar agreement When I presented with her last year.
Sony is still against the acquisition and She made filings to regulators about her concerns about the takeover. On Sunday, Xbox chief Phil Spencer said Microsoft and Sony had agreed on a 10 years “binding agreement” To keep Call of Duty on the PlayStation platform. It’s unclear if the latest arrangement is different from what Microsoft showed Sony last year.
Earlier this year, Microsoft did something similar A 10-year agreement with Nvidia to ensure the GeForce Now cloud gaming platform He continues to have access to games from both Microsoft and Activision.
Microsoft uses these agreements with its competitors to show regulators that there will be no shortage of competition in the video game industry.
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