In a recent interview, Microsoft’s president Brad Smith made it apparent that the company is choosing a different strategy to complete the $69 billion Activision acquisition. To demonstrate that it has no malicious intent in the market battle, the software giant is now attempting to make peace with its competitors and authorities, unlike in the past. According to Smith, the business is still holding out hope that its “good guy” approach will help seal the deal. through The New York Times
Smith described in the interview how the chair of the Federal Trade Commission, Lina Khan, responded when she was given the opportunity to allay fears. Smith added that although she declined his offer, “she at least cracked a smile when I said give peace a try.” There is therefore always a glimmer of optimism that we will be able to sit down together in the future whenever someone can leave a meeting by smiling even a little.
Now, though, everything is drastically different since the FTC is firmly committed to preventing the merger. Smith recalled a meeting between the agency’s staff and the staff of the business.
“Can we consider a settlement proposal?,” our staff enquired. He explained that the workers responded, “Not with us. Ironically, Holly Vedova, director of the FTC’s Bureau of Competition, stated that the US agency is always receptive to suggestions from businesses that seek to fix antitrust issues.
Different regulators are currently reviewing the agreement, particularly those from Britain and the European Union. The FTC recently moved forward by submitting a complaint in which it declared complete support for the merger. Recalling its earlier assertions, the agency asserted that Microsoft gave the European Commission assurances regarding maintaining the availability of ZeniMax titles to rivals following approval of the ZeniMax Media acquisition. The EU, on the other hand, refuted everything and made it clear that Microsoft had not made any such “commitments.”
The EU’s remark may have hurt FTC’s position, but the agency is adamant about continuing to pursue the lawsuit in the administrative court. The destiny of the deal now heavily depends on the judgement made by the other regulators. If Microsoft receives backing from other competition watchdogs, the FTC might ask a federal judge to impose an injunction. Even in this situation, Microsoft still has a good chance of winning. Additionally, this week, the UK’s Competition and Markets Authority announced that, according to the replies it got, 75% of the public supports the agreement.
Microsoft and the US agency each have strong arguments for why they should prevail in the former’s lawsuit. The success of the software behemoth, though, may have more significance because it will also help rival IT firms that want to make significant acquisitions in the future. Microsoft’s victory before the FTC could open doors for others in the sector, which is currently heavily regulated by competition watchdogs.
However, despite its reputation as a fighter in legal disputes, Microsoft’s current attitude toward rivals is clearly influenced by Smith’s alleged “good guy” style. Microsoft consistently emphasised that the goal of the deal is to foster competition, but it also made concessions to its rivals (by giving Nintendo a 10-year Call of Duty licencing agreement and offering Sony the same), and even pledged to maintain its neutrality in the event that Activision employees decided to organise a union following the acquisition.