The FTC sues Microsoft to block its Activision Blizzard merger

gamedeveloper.com:

The Federal Trade Commission is blocking Microsoft's in-progress acquisition of Activision Blizzard, reports the Washington Post. Voting to issue a lawsuit against the Xbox maker commenced in administrative court, and three Democrats voted in favor of it. 

In what's the biggest move from the FTC since Lina Khan became its chair, the organization is suing the Xbox maker to prevent it from acquiring the Call of Duty publisher. This was previously rumored to occur last month, and comes not long after a reported rift in the FTC was believed to be a boon to Microsoft's acquisition efforts.

As Axios notes, however, the organization chose to file its complaint in an administrative court rather than a federal one. Additionally, it hasn't filed an injunction to stop the deal from closing, making it's still possible for the deal to close.

“Today we seek to stop Microsoft from gaining control over a leading independent game studio and using it to harm competition in multiple dynamic and fast-growing gaming markets," wrote FTC's Bureau of Competition director Holly Vedova.

Per an anonymous FTC official speaking to the Washington Post, Microsoft's acquisition would result in it becoming a larger player in the games space, potentially resulting in an unfair advantage for subscription and cloud-based game markets. Innovation in those markets would be greatly diminished, the official said. 

Xbox exclusive games were another listed reason for preventing the merger, according to the FTC's statement. Citing Bethesda's upcoming Starfield and Redfall as examples, the organization wrote that Microsoft has "already shown that it can and will withhold content from its gaming rivals."

Following the FTC's lawsuit, Activision Blizzard's Lulu Cheng