Microsoft’s acquisition of Activision Blizzard is a step closer to happening after a California judge has blocked the Federal Trade Commission’s (FTC) injunction request, which would have blocked the deal.
The decision, announced Tuesday morning, does not clear the deal entirely, however. The FTC may appeal the ruling. And Microsoft and Activision must also convince regulators in the UK to reverse their own opposition to the deal.
“The Court finds the FTC has not shown a likelihood it will prevail on its claim this [merger] may substantially lessen competition,” wrote Judge Jacqueline Scott Corley in her decision. “To the contrary, the record evidence points to more consumer access to Call of Duty and other Activision content.”
The decision comes after five days of hearings surrounding the $68.7 billion acquisition, which was announced last year. The FTC has maintained that Microsoft would make certain games, such as Call of Duty, exclusive, which would lessen competition and give it an unfair advantage in the video game industry, particularly in the growing field of cloud gaming.
Microsoft and Activision have vowed the hit series would not be limited to the Xbox platform, offering long-term deals to Sony.
“Microsoft’s acquisition of Activision has been described as the largest in tech history. It deserves scrutiny,” the judge wrote. “That scrutiny has paid off: Microsoft has committed in writing, in public, and in court to keep Call of Duty on PlayStation for 10 years on parity with Xbox. It made an agreement with Nintendo to bring Call of Duty to Switch. And it entered several agreements to for the first time bring Activision’s content to several cloud gaming services.”
Microsoft and Activision are hoping to close the deal by July 18th. Failing to do so could trigger a $3 billion “breakup fee”.
Still standing in the way, however, is the UK’s Competition and Markets Authority (CMA), which blocked the acquisition in April. An appeal on that ruling is set to begin July 28th. (European regulators approved the deal in May.)
Beyond Call of Duty, Activision is responsible for several other major game franchises, including World of Warcraft, Overwatch, Candy Crush and Diablo.