Legal Expert Explains Why Microsoft's Acquisition of Activision Blizzard Won't Break Antitrust Laws
On Tuesday, Microsoft and Activision Blizzard publicly announced that the former would be acquiring the latter in a nearly $70 billion deal. If the deal goes through, pending approval from all the appropriate government agencies, it would be the largest acquisition in the video game industry's history. There are some questions regarding whether the United States of America's government will stop Microsoft's acquisition due to antitrust law, however. One legal expert says that there's nothing to worry about, in that regard.
Speaking with IGN, Gamma Law's managing partner David Hoppe weighed in on the possibility of the Activision Blizzard acquisition being held up due to antitrust law. Simply put, Hoppe doesn't believe that there's any reason to worry. He says that courts in the United States have, "historically been unwilling to apply restrictive antitrust principles to vertical transactions." While Hoppe leaves room in his language for the possibility of a change in policy, he clearly expects otherwise.
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As for what a vertical transaction means, it refers top the joining of two or more companies that provide different functions. In this case, Microsoft is a platform provider and distributor. It provides the Xbox console, as well as the economy that runs on it. Activision, in turn, is a video game publisher and so is further down the food chain, so to speak. An appropriate comparison would be Microsoft's early acquisition of publishers like ZeniMax Media or Double Fine Productions, both of which went through without a hitch.
The comparison to ZeniMax Media and Double Fine is, of course, flawed in scale. Activision Blizzard is one
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