The Federal Trade Commission’s preliminary motion to stop Microsoft from acquiring Activision-Blizzard has been rejected. The case is now primarily considered resolved, as the courts deemed the FTC had not demonstrated that competition would be substantially affected. The injunction would have delayed the companies from merging. However, it is now expected that the two companies may begin fully integrating as early as this month.
For gamers, this represents a win through increased access to Activision’s gaming library.
Following this decision, the British Competition and Markets Authority (CMA) announced that it would reconsider the case after it had previously blocked the acquisition in the United Kingdom. If the CMA permits the deal, it will join the global consensus that the acquisition is not anti-competitive.
The FTC’s initial decision to bring the complaint can be partly attributed to the agency’s ideological opposition to mergers and acquisitions by large tech firms. This bias against large firms denies increased efficiency and consumer benefits achieved through size. Previously, such government overreach was mitigated by the reliance on the Consumer Welfare Standard (CWS). The current FTC chair has abandoned this concept in favor of measuring competition by relative size and a tendency to measure harm to competitors rather than consumers.
Read the full DC Journal Article here.
Ben Dennehy is the Communications Manager at the American Consumer Institute, a nonprofit education and research organization. For more information about the Institute, visit us at www.TheAmericanConsumer.Org or follow us on Twitter @ConsumerPal.