Microsoft has reacted in kind to the antitrust case filed by the US Federal Trade Commission (FTC), which seeks to stop the $68.7 billion acquisition of Activision Blizzard that was announced in January 2022.
CNBC published the complete statement written by Microsoft’s legal team. The Xbox corporation goes so far as to assert that the FTC’s procedures are against the US Constitution throughout its 37 pages. Here is a passage from the section on affirmative and other defenses towards the end.
Under the Fifth Amendment’s Due Process Clause, Microsoft’s right to procedural due process is violated by the Commission’s practices. Microsoft’s Fifth Amendment Due Process right to adjudication before a neutral arbiter is broken by the administrative processes’ framework, in which the Commission starts and ultimately decides the Complaint against it.
Due to the Commission’s prejudging of the merits of the current action, these administrative processes infringe upon Microsoft’s Fifth Amendment Due Process right to adjudication before a neutral judge.
Microsoft’s legal team naturally responded to the FTC’s accusations with considerably more detailed refutations. For instance, they claimed that the exclusivity of Xbox and PC for Starfield and Redfall (as well as a third, unannounced game that will also be an exclusive) had nothing to do with the Activision Blizzard issue because both games would be played alone or by small groups.
The Elder Scrolls Online and Fallout 76 are two examples of multiplayer games that Microsoft has maintained to support across various platforms. Microsoft claims that Call of Duty is in the same category as games that focus primarily on multiplayer and are designed to be played by sizable groups.
As a result, Microsoft would not be interested in removing Call of Duty from PlayStation; if there were any remaining uncertainty, Microsoft claims that Xbox’s promise to release Call of Duty on other platforms with advantageous commercial conditions for different platforms should settle the issue.
The answer also addresses the FTC’s assertion that Microsoft misled the European Commission about the acquisition of ZeniMax.
Any argument that Microsoft misrepresented ZeniMax’s remarks to the European Commission
were false is deceptive. Microsoft made it clear that it will respect Sony’s current exclusivity.
Rights and handle exclusivity for upcoming game releases individually, precisely
what it accomplished. In a public statement, the European Commission acknowledges that it was not deceived.
Following the complaint that Microsoft did not provide the European Commission with any “commitments,”
Additionally, the European Commission “did not rely on any statements provided by Microsoft about the future distribution plan for ZeniMax’s games.” The European Commission, however, approved
the deal “unconditionally as it judged that the deal would not raise issues regarding the competition.”
According to Microsoft, the FTC’s case should be dismissed because the Commission cannot show how the deal will harm consumers.
Since they would have new and cheaper methods to play Activision’s games (namely, Game Pass), finally, there is a direct swipe at Sony, which has attempted to block the purchase at every turn.
The antitrust rules do not shield the dominant market player and its preferred business model from the competition. Sony may choose to safeguard the profits it receives from more expensive individual game sales.
In related news, the UK’s Competition and Markets Authority (CMA) made the public feedback it had gotten from the general public available. Over 2100 emails were addressed to the CMA, and almost 75 percent supported closing the purchase. The second round of the CMA’s inquiry into the Microsoft/Activision Blizzard agreement is ongoing.