A lawsuit was filed by gamers to prevent Microsoft from Activision Merger, claiming that doing so would decrease consumer choice and impede competition.
A private consumer lawsuit was filed against Microsoft Corp. on Tuesday in a U.S. court, alleging that the technology corporation’s $69 billion offer to buy Activision Blizzard Inc., the company behind the video game “Call of Duty,” will unjustly stifle competition in the sector.
About two weeks ago, the U.S. Federal Trade Commission filed a lawsuit with an administrative law judge to prevent Microsoft, the company that owns the Xbox system, from completing the biggest-ever acquisition in the video-gaming industry.
The gamers want to exert pressure on Microsoft in order to stop it from completing “the largest tech deal ever in the video gaming market and absorbing its main rival in the sector, which is similar to many of the FTC’s worries. Prior to filing suit, the FTC stated that it did so to prevent Microsoft from controlling a leading independent game studio.
The organization said that the Activision Merger would hurt competition between competing gaming platforms from Sony Group Corp. and Nintendo Co Ltd.
Ten video game gamers from California, New Mexico, and New Jersey filed the lawsuit. The plaintiffs identify Activision Blizzard as a significant rival that promotes industry-wide innovation and pricing competition in their lawsuit.
Consumers can object to acquisitions like this through the Clayton Antitrust Act, which gives courts the opportunity to consider the anti-competitive harms argued by consumers. The gamers who are suing Microsoft for potentially breaking antitrust laws are extremely concerned that the pricing of their favorite games may soon rise while the quality of those games may decline.
They claim that if the Activision Merger is approved, Microsoft would be in a position to monopolize the greatest talent and the most well-liked games in order to perhaps obtain “far-outsized market power.”
In a statement on Tuesday, a Microsoft spokesman justified the agreement and said that it would boost competition and generate more options for gamers and game creators. Microsoft President Brad Smith stated, “We have complete confidence in our case and welcome the opportunity to present our case in court,” following the FTC’s lawsuit.
Plaintiffs’ attorney Joseph Saveri in San Francisco stated in a statement, “as the video game industry continues to grow and evolve, it’s critical that we protect the market from monopolistic mergers that will harm consumers in the long run.”
The lawsuits offer a distinctive viewpoint to the discussion around Microsoft’s proposed acquisition of Activision, which Microsoft intends to conclude in 2023. They claim in their case that because Microsoft is aware that gamers are unlikely to switch to other games in place of their favorites, they are especially susceptible to price increases.
This means that Microsoft might block access to platforms or services outside of its gaming ecosystem and take popular games—like Call of Duty games, which are played by all plaintiffs.
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