More than a dozen advocacy groups have raised their concerns over Microsoft’s planned acquisition of Activision Blizzard. They asked the Federal Trade Commission to closely review the deal to stop potential damage to the market, including a threat to fair competition.
An open letter, published on March 1, was addressed to FTC chair Lina Khan. It was signed by 15 groups, including consumer advocacy organization Public Citizen, labor union Communication Workers of America, and antitrust organization Open Markets Institute.
“We believe that the transaction may lead to an undue concentration of market power when viewed as a vertical or horizontal merger, threaten data privacy and security, undermine consumer protection online, impinge on the consumer right to repair and exacerbate worker disempowerment and wage suppression,” the letter reads.
The groups also explained why the Activision Blizzard acquisition can be viewed both as a vertical and horizontal merger.
In the first case, Microsoft, which is one of the biggest platform holders in the world, will get a sizable segment of the game publishing market and will threaten fair competition. What makes the deal horizontal is that Microsoft plans to add a large company with 400 million MAU to its gaming business, becoming the third biggest publisher globally.
According to the letter, the deal might also lead to Microsoft increasing prices on subscriptions and its other services, additionally harming consumers.
Microsoft’s acquisition of Activision Blizzard should have initially been reviewed by Department of Justice. In February, Bloomberg reported that it will be monitored by the FTC. On top of that, the Commission’s chair Lina Khan has a tougher approach to reviewing such deals and openly opposes the market dominance of big tech companies.