The US is entering a legal battle with Xbox maker Microsoft to block its plan to buy the gaming company behind hit titles like Call of Duty.
Regulators cited competition concerns and said they feared Activision Blizzard’s games would no longer be offered on non-Microsoft gaming consoles if the deal went through.
The Activision purchase would be the largest in Microsoft history.
The company said it would fight to secure the $69 billion (£56 billion) deal.
Microsoft President Brad Smith said the company has “complete confidence in our case and welcomes the opportunity to take our case to court.”
The lawsuit against Microsoft is among the most high-profile lawsuits to emerge from US President Joe Biden’s pledge to crack down on monopolies.
The proposed deal had already raised concerns in other countries, including the UK.
Activision Blizzard owns some of the most popular games in the world including the Call of Duty series, World of Warcraft, Overwatch and Candy Crush.
The Federal Trade Commission, the US consumer regulator that filed the complaint, said Activision is one of the top few video game developers to have made high-quality games for multiple devices.
The deal would give Microsoft “both the means and motive to harm competition” by manipulating prices, downgrading games on its competitors’ video game consoles, “or withholding content from competitors entirely, resulting in harm to consumers.” , the agency said in a press release.
The FTC pointed to Microsoft’s acquisition of ZeniMax, which owns video game studio Bethesda Softworks. Microsoft has announced that some of the studio’s future games will be exclusive to Microsoft consoles.
Microsoft said earlier this week it had agreed to make Call of Duty available on Nintendo for 10 years if the purchase goes through.
“That sounds alarming, so I want to reaffirm my confidence that this deal will go through,” Activision Blizzard CEO Bobby Kotick wrote in a letter to employees posted on the company’s website. “The claim that this deal is anti-competitive is not based on fact and we believe we will win this challenge.”
When Microsoft announced the deal, Microsoft said it intends to expand the games available on GamePass, its Netflix-style subscription gaming service, and for the increasing number of people using phones to play games.
The acquisition should make the company the world’s third-largest gaming company by revenue, behind China’s Tencent and Japan’s Sony, which owns Playstation and has criticized the deal.
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