Microsoft could take on FTC over $69 billion Activision Blizzard deal

Yahoo Finance's Dan Howley discusses why Microsoft is fighting to acquire Activision Blizzard and where it could lead the Big Tech company.

Video transcript

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RACHELLE AKUFFO: With the FTC potentially split on whether or not to approve Microsoft's $69 billion purchase of Activision Blizzard, the "Call of Duty" developer is reportedly planning to fight for the deal in court if it gets blocked. Yahoo Finance's Dan Howley has the latest. So, Dan, give us an update.

DAN HOWLEY: Yeah, this is, could be the first case that really turns Microsoft into the bad guy since it faced their antitrust lawsuits in the late '90s and early 2000s with regards to Internet Explorer and Windows. The company really has been kind of, for better, lack of a better term, the good guy, when it comes to Silicon Valley and the current spat of investigations, or at least having government looking into companies like Apple, Google, Amazon, and Meta, as far as antitrust violations go and potential antitrust violations go.

But this, if the FTC does move forward, we could see them try to sue to block Microsoft from fully acquiring Activision Blizzard for that $69 billion, the largest acquisition in Microsoft's history. And that would mean that Microsoft would be back to square one with the government, at least as far as antitrust goes and it's positioning.

It's been very diligent about ensuring that it's not lumped in with its cohort as far as antitrust violations go. It's called out Apple for the App Store and saying that there needs to be a way for developers to get their apps onto all devices. So this would be an interesting kind of change for them on that front.

But as far as why they want it, there's two real reasons. It's their Game Pass service, their cloud gaming platform. They want to make sure that that's the future. And some of the experts that I spoke to say that Microsoft doesn't see game consoles existing in the next 20, 30, 50 years. They'll be cloud-based platforms where you can play games on any device that you have.

The other thing is mobile. Activision Blizzard has King, which is one of the largest mobile platforms, or mobile game developers out there, or publishers out there. And so they would be able to get their hands on that. And then that would ensure that they are able to play in both the digital, excuse me, the mobile, console, and PC space.

It's important to point out that mobile is the fastest growing gaming sector out there. So they would really start to set themselves up as one of the larger gaming giants. And if they did acquire Activision Blizzard, they would become the number three gaming platform behind Tencent and Sony.