Google parent Alphabet Inc. and chip maker Nvidia have shared concerns about Microsoft’s proposed Activision Blizzard merger with the Federal Trade Commission (FTC).
The FTC is currently suing Microsoft to block the deal over fears it will allow the console maker to “harm the competition in multiple dynamic and fast-growing gaming markets.”
Now, according to a report from Bloomberg, two of the game and tech industry’s major players have waded into the debate by telling the FTC the move could give Microsoft an unfair advantage in the cloud, subscription, and mobile gaming markets.
One person familiar with the matter said that Nvidia specifically reiterated the need for equal and open access to game titles and franchises, but said the company didn’t directly oppose the merger.
For context, Nvidia currently operates a cloud gaming service called GeForce Now, while Google also tried and failed to enter the same market with Google Stadia, which is due to shut down later this month. The company has, however, claimed it remains “deeply committed to gaming.”
Microsoft is currently attempting to gain regulatory approval for its mammoth $68.7 billion acquisition, which it announced in January 2022.
The deal is currently being heavily scrutinized in key regions such as the United States and UK, with regulators such as the FTC and Competition and Markets Authority (CMA) probing the deal over fears it could impede the ability of rivals such as Nintendo and Sony to compete with the Xbox maker.
In response to the CMA’s investigation over in the UK, Sony said it’s concerned the deal might cause it to lose “significant revenues” if Microsoft takes control of key Activision Blizzard franchises like Call of Duty and Overwatch.
The company also suggested that independent developers would be worse off if the deal closes, suggesting they’ll “likely receive worse terms for their content from Microsoft or even be required to promise exclusivity in return for distribution.”
Microsoft has pushed back on Sony’s claims, and has offered to ensure Call of Duty remains on rival platforms for at least a decade following the deal. It also claims Sony has the ability to respond to the merger in kind, pointing to the company’s recent accusation of Destiny developer Bungie as evidence of the PlayStation maker’s ability to bolster its own business.
The CMA recently extended its investigation, and now expects to publish its findings at the end of April 2023.