Microsoft’s planned acquisition of Activision Blizzard has had stiff opposition from the US Federal Trade Commission. Now, it's about to face even more resistance from consumers.
A group of ten Call of Duty gamers has filed a lawsuit in a federal court in California against Microsoft. The aim is to stop the merger between the tech giant and easily one of the most massive video game makers in the world. The deal between is worth $68.7 billion and has prompted investigations from the EU Commission and UK CMA.
This new complaint echoes several key points from the objections by FTC. The FTC argued that "there are only several independent game publishers in the world that are capable of making the highest production quality and most graphics-intensive videogames that can be mass marketed and are highly anticipated among gamers," and the merger of these two companies would be bad for consumers, employees and the industry as a whole.
Furthermore, the FTC said Microsoft lied when it said to European regulators that it "would not have the incentive to cease or limit making ZeniMax games available for purchase on rival consoles."
The tech giant acquired ZeniMax, the parent company of Bethesda Softworks in 2021 and subsequently announced that will make the upcoming Starfield and Redfall exclusive to the Xbox One and Xbox Series S/X.
The complaint alleges that the acquisition would give Microsoft "far-outsized market power in the video game industry" and give it "the ability to foreclose rivals, limit output, reduce consumer choice, raise prices, and further inhibit competition." According to the lawsuit, the deal "is a violation of Section 7 of the Clayton Antitrust Act in that the effect of the potential consolidation "may be substantially to lessen competition or tend to create a monopoly” in various markets in the video game industry."
The new lawsuit also alleges that "currently, Microsoft Xbox and Sony PlayStation systems compete vigorously with one another. Foreclosing Activision Blizzard titles from appearing on PlayStation would harm competition between Xbox and PlayStation."
The gamers behind the lawsuit are asking the court to declare the merger as a violation of the Clayton Antitrust Act. The lawsuit seeks to permanently block the deal from happening.
Microsoft has issued a statement defending the proposed deal saying that it "will expand competition and create more opportunities for gamers and game developers." Microsoft President Brad Smith previously stated that the company has "complete confidence in our case and welcome the opportunity to present our case in court."
Joseph Saveri, the lawyer for the plaintiffs issued a statement saying that "as the video game industry continues to grow and evolve, it's critical that we protect the market from monopolistic mergers that will harm consumers in the long run."
Microsoft and Activision Blizzard have until July to finalize the merger before needing to renegotiate the terms of the deal.