US Judge Temporarily Blocks Microsoft Acquisition of Activision (reuters.com) 40
A U.S. judge has granted the FTC request to temporarily block Microsoft's acquisition of Activision Blizzard, scheduling a hearing for a preliminary injunction and preventing the deal from closing until a court ruling is made. Reuters reports: U.S. District Judge Edward Davila scheduled a two-day evidentiary hearing on the FTC's request for a preliminary injunction for June 22-23 in San Francisco. Without a court order, Microsoft could have closed on the $69 billion deal as early as Friday. Davila said the temporary restraining order "is necessary to maintain the status quo while the complaint is pending (and) preserve this court's ability to order effective relief in the event it determines a preliminary injunction is warranted and preserve the FTC's ability to obtain an effective permanent remedy in the event that it prevails in its pending administrative proceeding."
Microsoft and Activision must submit legal arguments opposing a preliminary injunction by June 16; the FTC must reply on June 20. Davila said the bar on closing will remain in place until at least five days after the court rules on the preliminary injunction request. The case reflects the muscular approach to antitrust enforcement taken by the administration of U.S. President Joe Biden.
Microsoft and Activision must submit legal arguments opposing a preliminary injunction by June 16; the FTC must reply on June 20. Davila said the bar on closing will remain in place until at least five days after the court rules on the preliminary injunction request. The case reflects the muscular approach to antitrust enforcement taken by the administration of U.S. President Joe Biden.
Just cancel it (Score:4, Insightful)
Maybe they should simply cancel the buyout and deny any purchase where the business being bought is worth more than a billion.
Basically we are dealing with too many large scale mergers or buyouts, which ends up giving too much control to too few players. At least thatâ(TM)s the impression I get.
You would need a major political sea change (Score:3)
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That would be true, if Microsoft were say a European company more concerned with growing itself than
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Its a decent enough idea, but that criteria doesn't currently exist. An arbitrary limit on company value barring aquisition would be the type of thing that needs to be handled via legislation, not just a "Meh I think this is a good idea so it should be so."
Re:Just cancel it (Score:5, Interesting)
Its a decent enough idea, but that criteria doesn't currently exist. An arbitrary limit on company value barring aquisition would be the type of thing that needs to be handled via legislation, not just a "Meh I think this is a good idea so it should be so."
You may be right that this wouldn't make it through the current pro-business Supreme Court, but the FTC has wide discretion on what would create a negative impact on competition in the industry. Biden signed an executive order in 2021 including 72 initiatives to improve competition in the marketplace. It specifically called out having greater scrutiny of mergers by dominant internet platforms. Now mergers can/should be stopped if they create a negative impact on competition, not just a negative impact on prices. It even allows the FTC to challenge prior mergers which past administrations did not previously challenge.
But the legality of that executive order is likely to make it to the Supreme Court if the FTC starts to flex its new muscle. With the current make-up of the court I wouldn't bet on the FTC keeping many of these new powers.
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You may be right that this wouldn't make it through the current pro-business Supreme Court
No it wouldn't make it through any court because the point is the legislative framework for such a decision doesn't exist. Having greater scrutiny requires you to have ... err... scrutiny. The only possible thing to do is to analyse the market situation and make a decision based on competition. There's nothing to arbitrarily draw a line at a dollar value for company size.
Incidentally a few other countries including the normally very aggressive EU have approved the mergers after looking at the competition, e
The Supreme Court has challenge (Score:2)
This goes against hundreds if not thousands of years of precedence, but when you're working backwards from your conclusion with a partisan Supreme Court anything is possible.
Roberts sometimes gets a little worried about being remembered as a political hack though and does something like that Alabama Gerrymandering ruling, so anything's possi
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This goes against hundreds if not thousands of years of precedence, but when you're working backwards from your conclusion with a partisan Supreme Court anything is possible.
What exactly goes against precedence here? All that is being proposed is the FTC stating any merger between companies of a certain size has a negative impact on competition in the industry. It would probably work better if they set the threshold based on the size of the industry instead of a flat number like $1 billion market cap, but the concept is the same.
The US gaming market is about $100 billion revenue per year. Microsoft made $16 billion and Activision Blizzard made almost $8 billion. This new compan
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You may be right that this wouldn't make it through the current pro-business Supreme Court, but the FTC has wide discretion on what would create a negative impact on competition in the industry.
The FTC has wide discretion on deciding to file a lawsuit. They can challenge damn near anything they choose. But it is still a matter to be decided by the court (unless the business in question agrees to settle via consent).
Makes one wonder! (Score:1)
This isn't likely to be a bribe (Score:2)
Why so much focus on Microsoft? (Score:5, Interesting)
Re: Why so much focus on Microsoft? (Score:2)
Not sure how much it is Microsoft and how is simply bad timing? Are countries starting to react against the type of mergers that have gone through in recent years or is something more particular about this buyout and the history of Microsoft?
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But of all the things to focus on, why focus on Microsoft's acquisition of a game company? Did someone not send their "campaign contributions" to the right place?
If I had to guess, I'd say this is probably more about Sony throwing their lobbying weight around rather than anything Microsoft didn't do.
As far as how it matters to consumers, this really isn't any different than how you have to own Nintendo hardware if you want to play Mario Kart. It's normally not even something most people think about, unless their friends are on the other platform. [youtube.com]
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Microsoft are not just another console company ... they control the PC market as well
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Because this is a technology forum (Score:2)
Previously the rule was that the FTC had to show the merger would have negative impact on consumer prices and that the company could basically pinky swear not to raise prices and the merger would go
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Acquisitions are naturally considered by anti-monopoly depts. The proposed merger had already been ruled on by the UK and EU.
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Microsoft being a convicted monopolist and repeatedly acting in bad faith in anti-competitive ways in the past heavily weighs against them when they are trying to consolidate and obtain a dominant position in other markets; this is a natural consequence of their own past transgressions.
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It's not the poster's standards, it's *federal law* for inter-state corporations. Past bad acts do not "go away".
This is another reason why mergers and acquisitions are *really* a bad idea (as opposed to simply buying the assets).
The new company gets stuck with every old debt (conditional and/or undisclosed), warranty claim, lawsuit, super-fund site, etc.
of the old companies.
Also, federal employees use Microsoft products. This is an opportunity to "stick it" to a software vendor who gives
them so much angs
Re:Why so much focus on Microsoft? (Score:4, Interesting)
So for one of the console makers to purchase one of the biggest publishers represents a significant consolidation of the market. Also, it's just a large merger in general. $70 billion is always going to draw scrutiny.
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It is very risky to invest into big gaming titles (Score:2)
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Microsoft can pay 67 billion and write off everything next year
This is nonsense. Luxuries do well during recessions, especially games due to value for money, and they're not trying to buy a tiny studio with one title.
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and they're not trying to buy a tiny studio with one title.
yeah they already got a couple dozen of those, Minecraft being by far the biggest.
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The UK said no. I think the EU decided on yes, with some minimal concessions.
If the US says no, then it will not go thru. If the US says yes, then it is going to happen -but the UK will get some additional concessions in exchange for removing their objection.
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Mergers reduce competition and... (Score:1)
If the US were serious about anti-trust... (Score:2)
If the US government wanted to show it was serious about enforcing anti-trust they would block the Kroger-Albertsons merger (something that seems far more anti-competitive and bad than the Microsoft-Activision merger)