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FTC opposes buyout of Activision Blizzard from Microsoft focused on the metaverse

FTC opposes buyout of Activision Blizzard from Microsoft focused on the metaverse

Microsoft CEO and President Satya Nadella has previously said that the acquisition of Activision Blizzard “will play a key role in the development of Metaverse platforms.”

Microsoft’s bid to acquire Activision Blizzard – a move originally intended to build Metaverse initiatives – hit a snag after the US Federal Trade Commission (FTC) intervened.

The FTC tried to stop Microsoft from acquiring the gaming giant to promote fair competition in high-end gaming consoles and subscription services. However, Microsoft CEO and President Satya Nadella has previously stated that the acquisition “will play a key role in the evolution of the Metaverse platforms.”

In a recent complaint, the FTC argued that Microsoft and Sony already “control” the high-end gaming industry – through the XBOX and Play Station consoles – and that the acquisition of Activision Blizzard would increase Microsoft’s influence in the gaming sector.

Holly Vedova, director of the FTC’s Competition Bureau, noted Microsoft’s experience in acquiring ZeniMax and limiting the release of popular games like Starfield and Redfall on XBOX consoles, adding:

“Microsoft has already shown that it can and will hide content from its gaming competitors.”

The complaint refers to the similar fate of Call of Duty, World of Warcraft, Diablo and Overwatch, as well as other games belonging to the Activision ecosystem. However, the FTC’s concerns indirectly affect Microsoft’s metaverse initiatives.

In July, the FTC filed a lawsuit against social media giant Meta, alleging that “its ultimate goal is to own the entire ‘Metaverse’.” “As Meta fully acknowledges, network effects on a digital platform can make the platform more powerful and its competitors weaker and less able to compete seriously as it gains more users, content and developers,” the FTC lawsuit says.

In October, a Meta shareholder urged the company to cut back on its annual investment. According to Brad Gerstner, CEO and founder of technology investment firm Altimeter Capital, Meta’s $10 to $15 billion a year investment in building the metaverse could only be profitable in ten years.

“An estimated investment of more than $100 billion into an unknown future is huge and horrifying even by Silicon Valley standards,” Gerstner said.

Arijit Sarkar, Cointelegraph

Arijit Sarkar is the editor of Cointelegraph. With a master’s degree in journalism and mass communications, he is pursuing his dream of changing the world for the better in the media industry. He also enjoys cycling and writing poetry.

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