FTC Opposes Metaverse-Focused Activision Blizzard Buyout of Microsoft
Microsoft CEO and President Satya Nadella previously said the acquisition of Activision Blizzard “would play a key role in the development of metaverse platforms.”
Microsoft’s attempt to acquire Activision Blizzard – a move originally intended to create Metaverse initiatives – hit a snag after interference from the US Federal Trade Commission (FTC).
Date FTC tried to prevent Microsoft from acquiring the gaming giant in order to promote fair competition in high-performance game consoles and subscription services. However, Microsoft CEO and Chairman Satya Nadella had previously declared that the acquisition “would play a key role in the development of metaverse platforms”.
In a recent complaint, the FTC argued that Microsoft and Sony already “control” the high-performance gaming industry – via XBOX and Play Station consoles – and that the acquisition of Activision Blizzard would increase Microsoft’s power in the sector.
Holly Vedova, Director of the FTC’s Competition Bureau, noted Microsoft’s track record in acquiring ZeniMax and limiting the release of popular games, such as Starfield and Redfall, to XBOX consoles, adding:
“Microsoft has already shown that it can and will withhold content from its gaming rivals.”
The complaint speculates on a similar fate for Call of Duty, World of Warcraft, Diablo and Overwatch, among other games, which belong to the Activision ecosystem. However, the FTC’s concerns have an indirect impact on Microsoft’s metaverse initiatives.
In July, the FTC filed a lawsuit against social media giant Meta, alleging “its ultimate goal to own the entire ‘metaverse'”. “As Meta fully acknowledges, network effects on a digital platform can make the platform more powerful – and its rivals weaker and less able to compete seriously – as it gains more users, content and developers,” a the FTC said in the complaint.
In October, a Meta shareholder urged the company to reduce its annual investment. According to Brad Gerstner, CEO and founder of technology investment firm Altimeter Capital, Meta’s investments of $10 billion to $15 billion a year in building the metaverse could take a decade to generate returns.
“An estimated $100+ billion investment in an unknown future is oversized and terrifying, even by Silicon Valley standards,” Gerstner said.
By Arijit Sarkar, Cointelegraph
Arijit Sarkar is an editor at Cointelegraph. With a Masters in Journalism and Mass Communication, he pursues his dream of making a positive difference in the media industry. He also enjoys cycling and writing poems.
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