Microsoft vs. "Gamers": Redmond settled the antitrust lawsuit saga

Microsoft has settled an antitrust lawsuit filed by “gamers” from various states over its $69 billion acquisition of Activision Blizzard on Monday. Although the settlement terms were undisclosed, the dismissal prevented the refiling & reopening of the case, and both parties agreed to cover their own legal costs.

The lawsuit—filed in 2022—argued that Microsoft’s increased market power could harm competition, despite a previous ruling against the FTC’s attempt to block the merger. The gamers also claimed that the merger would allow Microsoft to cancel premium game titles, raise prices, and reduce consumer choice, potentially making certain titles exclusive to Xbox.

“As time passes, Microsoft continues to increase its market power, prices have increased, games continue to be canceled, development capacities continue to diminish, and Game Pass continues to trend towards a monopoly,” says lawyer Joseph Saveri, representing the gamers (via The Hollywood Reporter).

The number of Xbox Game Pass subscribers has grown astronomically since the acquisition, from 25 million in 2022 to over 35 million.

The subscription service is projected to generate $5.5 billion by 2025, despite recent price hikes that affected Game Pass Ultimate subscribers. The service also launched a new tier, the Game Pass Standard, that excludes day-one releases but offers multiplayer access.

The FTC has criticized this new tier as a “degraded product” and raised concerns that Microsoft is using its market power post-Activision merger to push consumers toward more costly or less valuable options, which it argues could harm consumer choice.