Microsoft announced that it intends to acquire Activision Blizzard for $68.7 billion, a deal that will make Microsoft one of the biggest gaming companies in the world. With the deal, popular gaming franchises like Call of Duty, Warcraft, Overwatch, and more will be in the fold of Microsoft’s ever-expanding portfolio of studios, alongside Bethesda and its own Xbox Game Studios.
Also included as part of the deal is King, the makers of Candy Crush, signaling that Microsoft may utilize the company to compete in the mobile space. In early 2021, Take-Two Interactive (which houses developers like 2K, Private Division, and Rockstar Games) purchased Zynga for $12.7 billion.
Though the deal hasn’t come to pass, Microsoft’s intent to acquire Activision Blizzard raises questions around antitrust and around how Microsoft might steer Activision Blizzard’s toxic company culture and make adjustments to its leadership’s role to promote an equitable work environment moving forward. The acquisition was announced after several high-profile claims of sexual harassment were levied against Activision Blizzard, and in July 2021, the California Department of Fair Employment and Housing (DFEH) sued Activision Blizzard for promoting a culture of “constant sexual harassment.”
On December 8th, the FTC announced it was suing Microsoft to block the deal, saying, “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.” Microsoft’s vice president and chairman Brad Smith responded by saying “We have been committed since Day One to addressing competition concerns, including by offering earlier this week proposed concessions to the FTC. While we believed in giving peace a chance, we have complete confidence in our case and welcome the opportunity to present our case in court.”
We’ll be keeping you updated with the latest news on the big acquisition here, with reports that interrogate how the gaming world might change (in good ways and in bad ways) with one of the largest third-party game studios under Microsoft’s ownership.
Activision Blizzard CEO denies culture of harassment and blames unions for company problems
In 2021, the state of California sued Activision Blizzard, alleging that the video game publisher fostered a pervasive culture of harassment going back years. Details in the suit spoke of “cube crawls,” where male employees would get drunk and walk around the workplace subjecting female employees to inappropriate behavior. It alleged that male employees would pawn off responsibilities to their female co-workers, how women of color were passed up for opportunities given to less tenured workers, and how a senior World of Warcraft developer was so infamous for his harassment of women that his office was nicknamed the “Cosby suite.”Read Article >
But news of the suit was just the opening salvo in what would become a battery of reporting, documenting the kinds of harassment that went on at Activision Blizzard. Current and former employees shared their stories, including how a woman was demoted for allegedly reporting her harasser, how a nursing mother had her breast milk stolen from company refrigerators, and how one employee’s sexual harassment led to their death by suicide.
May 26Microsoft has appealed the CMA’s decision to block the Activision deal, and now we know Microsoft’s arguments.
VGC spotted the “Summary of Application” document, which outlines Microsoft’s five grounds for the appeal. For example:
The Respondent’s finding that Activision would have been likely to make its gaming content available on cloud gaming services absent the Merger was irrational and arrived at in a procedurally unfair manner.
You can read the whole document here. The CMA blocked the deal in April.
May 10The EU is expected to approve Microsoft’s Activision acquisition.
May 15th is the “likeliest date” for that to happen, according to Reuters. The approval, if it goes through, would arrive just a few weeks after UK regulators blocked the deal.
Microsoft’s Activision deal is on life support because cloud gaming still sucks
I am not a merger apologist. I generally don’t think the world’s better off with an ever-smaller number of companies at the helm! But of all the reasons to block Microsoft’s $68.7 billion purchase of Activision Blizzard, I never dreamed that “We need to stop Microsoft from dominating cloud gaming” would be the one.Read Article >
Yet that’s exactly the door regulators chose to walk through on Wednesday, when the UK’s Competition and Markets Authority ruled that the deal could “alter the future of the fast-growing cloud gaming market, leading to reduced innovation and less choice for UK gamers over the years to come.” They’re denying a deal that was widely expected to be approved, leaving Microsoft and Activision Blizzard hanging their hopes on a European Union decision next month.
- Nvidia still wants Microsoft+ActiBlizz.
GeForce NOW and other cloud gaming providers stand to gain an even deeper catalog of games if Microsoft’s acquisition of Activision is completed. We see this as a benefit to cloud gaming and hope for a positive resolution.
Not surprising, because Microsoft promised Nvidia big things if the deal went through:
- “The UK is closed for business.”
Activision Blizzard has responded to the CMA’s block of its merger with Microsoft by releasing its earnings statement a day early and a statement with some pretty harsh words.
The CMA’s report contradicts the ambitions of the UK to become an attractive country to build technology businesses. We will work aggressively with Microsoft to reverse this on appeal. The report’s conclusions are a disservice to UK citizens, who face increasingly dire economic prospects. We will reassess our growth plans for the UK. Global innovators large and small will take note that - despite all its rhetoric - the UK is clearly closed for business.
Microsoft details how it could get Call of Duty: Warzone running on Switch
In a filing (pdf) submitted to the UK’s Competition and Markets Authority (CMA), Microsoft shared some details about how it thinks it will be able to get Call of Duty games to run on the Nintendo Switch.Read Article >
Last month, Microsoft signed a binding 10-year agreement to bring Call of Duty games to Nintendo players day and date as on Xbox with “full feature and content parity” if its proposed acquisition of Activision Blizzard goes through. In the CMA filing, Microsoft makes two main points to argue that it’s possible to bring games like Call of Duty: Warzone and “buy-to-play” titles like Modern Warfare II to Switch:
Microsoft’s Activision acquisition in peril after UK regulator warns of harm to gamers
The UK’s Competition and Markets Authority (CMA) already expressed concerns about Microsoft’s plans to acquire Activision Blizzard last year, but it now says the deal could harm UK gamers. The CMA has published provisional findings in its investigation into the Microsoft and Activision deal and found that it “could result in higher prices, fewer choices, or less innovation for UK gamers.” The CMA has offered up possible remedies that include Microsoft being forced to sell off Activision Blizzard’s business associated with Call of Duty.Read Article >
The CMA makes it clear that it’s mainly concerned about two things: cloud gaming and game exclusivity. “The evidence available to the CMA currently indicates that Microsoft would find it commercially beneficial to make Activision’s games exclusive to its own cloud gaming service (or only available on other services under materially worse conditions),” says the UK regulator.
FTC won’t appeal court decision permitting Meta to buy Within
The Federal Trade Commission will not appeal a recent federal court order allowing Meta to purchase VR startup Within, an agency official told reporters on Monday.Read Article >
The FTC sued to stop Meta’s acquisition of Within, the company behind the popular fitness app Supernatural, last July. The agency argued that the purchase would expand Meta’s dominance in the VR market, pointing to the Oculus maker’s previous 2019 merger with the company behind Beat Saber. Meta fought the suit but later agreed to delay closing the deal until January 31st.
The EU has reportedly issued a formal warning to Microsoft over the Activision Blizzard deal
Microsoft is seemingly facing more regulatory opposition to its proposed acquisition of Activision Blizzard. According to Politico, the European Union has issued a formal antitrust warning against Microsoft regarding the $68.7 billion deal.Read Article >
Politico didn’t share exact details about the contents of the warning, but the publication says that in a “statement of objections,” EU officials “laid out the reasons why the deal could threaten fair competition on the video game market.”
Jan 12Google and Nvidia have reportedly raised some flags with Microsoft’s Activision Blizzard deal.
According to Bloomberg sources, they apparently expressed concerns about the megadeal to the FTC, which is suing Microsoft to block the purchase:
Google and Nvidia provided information that backs a key FTC contention — that Microsoft could gain an unfair advantage in the market for cloud, subscription and mobile gaming — according to the people, who asked not to be identified because the process is confidential. In its remarks to the FTC, Nvidia stressed the need for equal and open access to game titles but didn’t directly oppose the acquisition, according to one of the people.
Microsoft is running an ad in The Washington Post to say that it’s cool with unions
Microsoft has been going out of its way to encourage regulators to approve its proposed $68.7 billion deal for Activision Blizzard, and in its latest move, the company is running an ad in The Washington Post spelling out the tech giant’s acceptance of unions. The ad is co-signed by the Communications Workers of America (CWA), which represents workers in industries like communications and media.Read Article >
“As we enter a new year, we remain committed to creating the best workplaces we can for people who make a living in the tech sector,” the beginning of the ad reads. “When both labor and management bring their voices to the bargaining table, employees, shareholders and customers alike benefit.”
- Microsoft no longer claims the FTC’s structure violates the Constitution.
That’s one strategy that didn’t pay off. Great scoop from Axios’ Stephen Totilo.
Jan 3Microsoft has formally recognized the ZeniMax union.
QA workers at Microsoft’s ZeniMax Studios have voted to join the Communications Workers of America and, true to its word, Microsoft has formally recognized the organization. That means that the National Labor Relations Board won’t have to litigate the election, and the company and the union can start negotiating.
The approximately 300 workers in the union are looking to “put an end to sudden periods of crunch, unfair pay, and lack of growth opportunities within the company,” according to one employee quoted in the CWA’s press release.Quality Assurance Workers at Microsoft’s ZeniMax Studios Establish Company’s First Union
[Campaign to Organize Digital Employees (CODE-CWA)]
Dec 27, 2022Workers at Activision Blizzard’s Proletariat studio are organizing.
Less than a month after a second group of Activision Blizzard workers voted to unionize, the Communications Workers of America announced the latest group filing for a union representation election.
The 57 workers in the unit include animators, designers, engineers, producers and quality assurance workers. Earlier this year, quality assurance workers at Activision’s Raven Software studio in Wisconsin and Blizzard Albany won their union elections, despite Activision Blizzard’s repeated attempts to prevent workers from voting.
“Everyone in the video game industry knows Activision Blizzard’s reputation for creating a hostile work environment, so earlier this year, when we heard that Blizzard was planning to acquire Proletariat, we started to discuss how we could protect the great culture we have created here,” said Dustin Yost, a Software Engineer at Proletariat. “By forming a union and negotiating a contract, we can make sure that we are able to continue doing our best work and create innovative experiences at the frontier of game development.”Proletariat Workers Become Third Group of Activision Blizzard Workers to Form Union with Communications Workers of America
[Communications Workers of America]
Dec 23, 2022
Read Microsoft’s response to the FTC’s Activision Blizzard lawsuit
Microsoft has filed its response to the lawsuit filed by the US Federal Trade Commission to block the company’s acquisition of Activision Blizzard. In the 37-page document, which you can read in full below, Microsoft argues its case for why its $68.7 billion acquisition should go through — it also defends its acquisition of Bethesda owner ZeniMax, while admitting that it’s planning to make three future titles from the company exclusive to Xbox and PC.Read Article >
Those games aren’t named, though Microsoft has basically announced that The Elder Scrolls VI will only be available on its platforms, and confirmed Starfield will be exclusive.
Dec 23, 2022
Microsoft says three future Bethesda games will be Xbox-exclusive
We knew Microsoft would make Bethesda’s Starfield exclusive to Xbox and PC, and it sure looked like The Elder Scrolls VI would skip PlayStation and Nintendo, too. But now, Microsoft’s lawyers are revealing that they’ve got eyes on at least one more exclusive title — there are three future Xbox exclusives from Bethesda, they revealed today, in a response to the FTC’s lawsuit against the Activision Blizzard deal.Read Article >
“Xbox anticipates that three future titles — REDACTED — all of which are designed to be played primarily alone or in small groups — will be exclusive to Xbox and PCs,” reads a passage in Microsoft’s response.
Dec 14, 2022Don’t you forget about me.
The folks at the Overwatch League Head Office shared a Grand Finals highlight video capturing all the match’s best moments. Since this is coming more than a month after the Grand Finals ended,
I have the suspicion that during this offseason — with no word how long it’ll be or in what capacity the Overwatch League will return when the fate of its four Chinese teams and the handful of teams that practice with them is up in the air thanks to the deal between Blizzard and its Chinese publishing partner NetEase has now dissolved — Blizzard wants to remind fans of all the fun they had watching in-person and online.
Dec 8, 2022
Tom Warren and Jay Peters
The FTC is suing Microsoft to block its Activision Blizzard purchase
The FTC has filed a legal challenge to try and block Microsoft’s plan to buy Activision Blizzard for $68.7 billion, according to a press release from the regulator. The lawsuit was filed today after weeks of back and forth between Microsoft, Sony, and regulators over competition concerns and the future of Call of Duty. The FTC argues that the acquisition would “enable Microsoft to suppress competitors to its Xbox gaming consoles and its rapidly growing subscription content and cloud-gaming business.” You can read the FTC’s redacted complaint here or embedded at the bottom of this article.Read Article >
The vote from the FTC commissioners today means Microsoft now faces significant hurdles to getting its Activision Blizzard deal complete. Regulators in the UK and EU are also scrutinizing the deal closely, despite Microsoft’s repeated attempts to appease regulators.
Dec 2, 2022
Another Blizzard QA department wins union vote
Workers at Blizzard’s Albany, New York offices — organized as GWA Albany under the Communications Workers of America (CWA) — have won their union vote, making them the publisher’s second union and the third overall union in the US video game industry. The vote was a majority decision — 14 “yes” votes out of a total possible 18 votes — marking an important step in Blizzard Albany’s unionization process that began in July of this year.Read Article >
“With this victory, we’re advocating for ourselves and each other because we care deeply about our work and the games we make,” said Amanda Deep, associate test analyst at Blizzard Albany, in a CWA press release celebrating the win. “Our colleagues at Raven inspired us when they announced the formation of the Game Workers Alliance / CWA. We can only hope that our win will continue to grow the labor movement at other video game studios across the country.”
Nov 17, 2022
Blizzard will suspend World of Warcraft in China over licensing dispute
Blizzard will suspend games in China because it can’t reach an agreement with its licensing and publishing partner NetEase, it said in a press release. World of Warcraft, Hearthstone, Overwatch 2, Starcraft, Heroes of the Storm, Diablo III, and Warcraft III: Reforged won’t be available in China after January 23, 2023.Read Article >
Blizzard will suspend the sale of games and offer guidance to Chinese players “in the coming days,” according to the press release, which did not offer a specific timeline. Development of Diablo Immortal is in a separate agreement and will continue, NetEase said in a statement. Upcoming releases, including the latest World of Warcraft expansion, Dragonflight, and the second season of Overwatch 2, “will proceed later this year,” according to Blizzard.
Nov 8, 2022
EU opens ‘in-depth investigation’ into Microsoft’s Activision Blizzard acquisition
The European Commission has opened what it calls an “in-depth investigation” into Microsoft’s proposed $68.7 billion acquisition of Activision Blizzard. Regulators in the EU first started looking at Microsoft’s Activision acquisition in September and set a provisional deadline of today to approve it or signal a more in-depth review.Read Article >
Microsoft now faces a larger probe over its plans to acquire Activision Blizzard, with the European Commission set to take 90 working days up to March 23rd to take a decision. The Commission says it’s opening up an in-depth investigation because it’s “concerned that the proposed acquisition may reduce competition in the markets for the distribution of console” and PC games.
Oct 12, 2022
Microsoft takes the gloves off as it battles Sony for its Activision acquisition
Microsoft isn’t happy with Sony and the UK’s Competition and Markets Authority. The UK regulator signaled an in-depth review of Microsoft’s $68.7 billion deal to acquire Activision Blizzard last month, and the CMA has now published its full 76-page report (PDF) on its findings. The CMA says it has concerns that Microsoft’s Activision Blizzard deal could lessen competition in game consoles, subscriptions, and cloud gaming, but Microsoft thinks the regulator has simply been listening to Sony’s lawyers too much.Read Article >
Microsoft pleaded for its deal on the day of the Phase 2 decision last month, but now the gloves are well and truly off. Microsoft describes the CMA’s concerns as “misplaced” and says that the regulator “adopts Sony’s complaints without considering the potential harm to consumers” and “incorrectly relies on self-serving statements by Sony which significantly exaggerate the importance of Call of Duty.” Microsoft even accuses the CMA of adopting “Sony’s complaints without the appropriate level of critical review,” suggesting that the regulator is simply just listening too much to what Sony has to say.
Sep 30, 2022European Commission starts reviewing Microsoft’s Activision acquisition.
Regulators in the EU are looking at Microsoft’s $68.7 billion acquisition, and have set a November 8th provisional deadline. It comes nearly a month after the UK’s CMA regulator signaled an in-depth review. Microsoft says “the deal is progressing in line with the expected regulatory schedule and process, and we remain confident that the acquisition will close in fiscal year 2023.”European Commission