image: Microsoft
On Wednesday, the Federal Trade Commission cited Microsoft’s recent pricing overhaul for Xbox Game Pass as Evidence of harm caused by merger Activision Blizzard has already made an impact on consumers. The agency submitted a new letter in its filing Continuing appeal deal last year, calling the changes “exactly the harm to consumers that the FTC alleges the merger would cause.”
Although the lawsuit seeking an injunction failed In order to freeze Microsoft’s acquisition of Activision Blizzard in July 2023, the U.S. Federal Trade Commission (FTC) appealed to the U.S. Ninth Circuit Court of Appeals. While it awaits a final ruling from those judges, the FTC has been submitting more evidence to support its assertion that the merger would harm competition in the gaming industry and harm customers, including a letter released by Microsoft earlier this year. Nearly 2,000 employees laid off Across newly acquired teams.
Today’s letter (wear and tear through play) tried to use Microsoft’s recent confusing changes to Game Pass to bolster its case, pointing out that Game Pass for Console will be canceled for new and lapsed subscribers and will be replaced by a more expensive “standard” bundle that doesn’t include Day one releases like this fall Call of Duty: Black Ops 6, Acquired as part of the Activision deal. As a result, access to all Game Pass games is only available with a Game Pass Ultimate subscription (now $20 per month).
“Microsoft’s price increases and product downgrades, coupled with Microsoft’s reduced investment in output and product quality through layoffs, see the FTC’s February 7, 2024 letter regarding a company’s post-merger exercise of market power. logo,” The Federal Trade Commission writes. It also noted that Microsoft made a statement in documents filed during last summer’s trial indicating that Game Pass would not become more expensive with the addition of Activision Blizzard games.
“Here, this acquisition will benefit consumers [Call of Duty] The company wrote at the time that the game would be available on Microsoft Game Pass the day it launches on consoles (the service won’t see a price increase due to the acquisition). That specific quote tour in several websiteand has since appeared to contradict this month’s sharp price increase, although Microsoft may try to argue that it wasn’t the acquisition that directly spurred the overhaul, but rather a larger strategic shift around its subscription services business.
“Microsoft’s post-merger actions demonstrate Congress’s design to initially halt the merger to fully assess its possible competitive effects, as well as the Justice Department’s suspicion of commitments that are inconsistent with the company’s economic incentives,” the FTC letter concluded. Not yet It’s unclear when the final decision on the appeal will be released, and it’s hard to imagine the consequences of Microsoft’s eventual defeat. There’s no doubt that this will be more confusing and confusing than the Game Pass overhaul.
