Category Archives: Microsoft

FTC Loses Appeals Court Bid To Temporarily Block Microsoft-Activision Deal

Microsoft, , ,

In a victory for Microsoft, the U.S. Appeals Court for the 9th Circuit late on Friday denied the Federal Trade Commission’s motion to temporarily stop Microsoft from closing its $68.7 billion acquisition of video game publisher Activision Blizzard, CNBC reported.

Microsoft is still working to resolve concerns about the transaction from the United Kingdom’s Competition and Markets Authority. The two companies have been looking to close the deal by July 18.

“We appreciate the Ninth Circuit’s swift response denying the FTC’s motion to further delay the deal. This bring us another step closer to the finish line in this marathon of global regulatory reviews,” Brad Smith, Microsoft’s president and vice chair, said in a statement.

A federal judge in San Francisco, after five days of court hearing, ruled against the FTC on Tuesday, and the federal filed its appeal on Wednesday…

…In an emergency motion filed with the 9th Circuit on Thursday, the FTC said the district judge “denied preliminary relief, applying the wrong legal standard: the court effectively required the FTC to prove its full case on the merits with the court as the arbiter of the merger’s legality.” The agency requested a temporary injunction while the court considered an appeal of the district court’s conclusion, CNBC reported.

The Wall Street Journal reported that an appeals court on Friday denied a last-ditch bid by the Federal Trade Commission to halt Microsoft’s planned $75 billion acquisition of videogame publisher Activision Blizzard.

In a brief order, the Ninth Circuit Court of Appeals rejected the FTC’s request for a court order that would have blocked Microsoft and Activision from merging while the agency appeals a July 11 decision by a trial court judge.

Friday’s order helps clear the way for Microsoft and Activision to close the merger, and puts pressure on the FTC to drop its appeal of the July 11 ruling.

In the July decision, U.S. District Judge Jacqueline Scott Corley said the agency hadn’t shown that Microsoft’s ownership of Activision titles, including the hit shooter-game series “Call of Duty,” would hurt competition in the console or cloud-gaming markets.

According to The Wall Street Journal, the FTC declined to comment.

The Verge also reported the FTC appealed the decision by Judge Jacqueline Scott Corley, and now the Ninth Circuit Court of Appeals has denied its request for emergency relief to prevent Microsoft from closing the deal until the result of the FTC’s appeal is complete.

Microsoft welcomed the denial late on Friday. “We appreciate the Ninth Circuit’s swift response denying the FTC’s motion to further delay the deal. This brings us another step closer to the finish line in this marathon of global regulatory reviews,” says Brad Smith, Vice Chair and President of Microsoft, in a statement to The Verge.

According to The Verge, this means Microsoft is now free to close its Activision Blizzard deal after a temporary restraining order, part of Judge Corley’s order, expired at 11:59PM PT, Friday July 14. Microsoft has until July 18th to close its deal; otherwise, it may need to renegotiate terms with Activision Blizzard, pay $3 billion in breakup fees if Activision wants to walk away, or simply let the deal deadline naturally extend if both parties are happy to.

The Verge also reported that the UK’s Competitions and Market’s Authority blocked Microsoft’s deal earlier this year, citing competition fears in the emerging cloud gaming market. Both CMA and Microsoft have agreed to pause their legal battles to figure out how the transaction might be modified in order to address the CMA’s cloud gaming concerns.

In my opinion, I think Judge Corley, and the Ninth Circuit Court, made the right decision. Both appear to have determined that the FTC’s case was not enough for a judgement to be made in their favor, and have instead decided in favor of Microsoft.

FTC Says It Will Appeal To Block Microsoft-Activision Deal

Microsoft,

The Federal Trade Commission is not giving up on its bid to prevent Microsoft from closing its $68.7 billion acquisition of game publisher Activision Blizzard, CNBC reported. On Wednesday, the agency filed to appeal a federal judge’s decision to deny a request for a preliminary injunction that would have prevented the deal from closing.

The decision comes one day after Judge Jacqueline Scott Corley, at the U.S. District Court for the Northern District of California, ruled in favor of the two companies.

According to CNBC, on Wednesday Activision Blizzard CEO Bobby Kotick told CNBC’s Julia Boorstin, “I’d be surprised if they would waste taxpayer resources on something like that,” referring to an FTC appeal. Kotick said he didn’t think the appellate court would grant a stay.

The FTC declined to comment on its legal response to the judge’s decision.

“The District Court’s ruling makes crystal clear that this acquisition is good for both competition and consumers,” Brad Smith, Microsoft’s president and vice chair, said in a statement. “We’re disappointed that the FTC is continuing to pursue what has become a demonstrably weak case, and we will oppose further efforts to delay the ability to move forward.”

CNBC also reported that the software maker is also trying to secure approval for the deal in the United Kingdom. Microsoft executive Brad Smith said the company and Activision Blizzard have agreed with the country’s Competition and Markets Authority that a stay of litigation would be beneficial.

The Hollywood Reporter wrote that a temporary restraining order, which was granted before a weeklong mini trial to decide whether the FTC should be granted a preliminary injunction, was issued in June to keep Microsoft from closing the transaction. It’s set to expire on Friday at midnight US West Coast time unless the US 9th Circuit Court of Appeals grants an emergency stay.

According to The Hollywood Reporter, the merger, if it closes, will make Microsoft one of the largest video game developers in the world. It will absorb over 15,000 employees from Activision, though there will likely be layoffs. The company has promised to increase access to Activision titles, including a 10-year deal to bring Call of Duty to the Nintendo Switch.

It also agreed to license games to any competing cloud service providers to secure approval from European regulators. Notably, Microsoft made one of ZeniMax’s regulators most popular titles, Starfield, exclusive to Xbox and Windows after assuring competition regulators that it wouldn’t limit games on rival consoles to get a deal to acquire the video game publisher greenlit.

The Verge reported that The Federal Trade Commission says it is appealing a recent US federal court order that cleared the way for Microsoft to purchase Activision Blizzard. The FTC filed a notice that it’s appealing Judge Jacqueline Scott Corley’s decision, but we won’t know the regulator’s arguments until the full appeal is submitted to the Ninth Circuit Court of Appeals.

According to The Verge, if the preliminary block had been granted, it would have temporarily blocked Microsoft from closing its Activision Blizzard deal until the result of the FTC’s own administrative case against the company. That separate legal challenge is due to commence on August 2nd.

In my opinion, it is good that Judge Corley supported Microsoft instead of the FTC, who appears to have presented a rather flimsy case. Despite that, the FTC now wants to prolong this situation by trying to convince the 9th Circuit Court of Appeals to reverse the decision. That’s disappointing.

Microsoft-Activision Deal Approved By Judge

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A federal judge in San Francisco has denied the Federal Trade Commission’s motion for a preliminary injunction to stop Microsoft from completing its acquisition of video game publisher Activision Blizzard, CNBC reported.

The deal isn’t completely in the clear, though. The FTC can now bring the decision to the U.S. Court of Appeals for the 9th Circuit, and the two companies must find a way forward to resolve opposition from the Competition and Markets Authority in the United Kingdom.

“This Court’s responsibility in this case now is narrow. It its to decide if, notwithstanding these current circumstances, the merger should be halted – perhaps even terminated – pending resolution of the FTC administrative action,” Judge Jacqueline Scott Corley wrote in her decision, published Tuesday. “For the reasons explained, the Court finds the FTC has not shown a likelihood it will prevail on its claim this particular vertical merger in this specific industry may substantially lessen competition. To the contrary, the record evidence points to more consumer access to Call of Duty and other Activision content. The motion for a preliminary injunction is therefore DENIED.”

Microsoft Vice Chair and President Brad Smith tweeted: “Our statement on today’s decision: We’re grateful to the Court in San Francisco for this quick and thorough decision and hope other jurisdictions will continue working towards a timely resolution. As we’ve demonstrated consistently throughout this process, we are committed to working creatively and collaboratively to address regulatory concerns.”

Activision posted the following on its corporate news website:

Activision Blizzard CEO Bobby Kotik sent the following email to employees on Tuesday:

Today, a U.S. federal judge ruled in our favor, denying the Federal Trade Commission’s attempt to block our merger with Microsoft.

We’re grateful to the court for the way this process was handled and the thoughtfulness of the decision. The U.S. joins the 38 countries where our deal can proceed – these decisions are based on facts and data that show our merger is good for players and for competition in the industry.

We’re optimistic that today’s ruling signals a path to full regulatory approval elsewhere around the globe, and we stand ready to work with the UK regulators to address any remaining concerns so our merger can quickly close.

We’ll continue to keep you updated on our progress. Thank you for all you do for our players, for our company, and for each other.

With gratitude,
Bobby

The Verge reported that in a statement, the FTC spokesperson Douglas Farrar said the FTC was still planning its next move. “We are disappointed in this outcome given the clear threat this merger poses to open competition in cloud gaming subscription services, and consoles. In the coming days we’ll be announcing our next step to continue our fight to preserve competition and protect consumers,” said Farrar.

According to The Verge, the judge’s ruling now allows Microsoft to close its Activision Blizzard deal ahead of the July 18th deadline, but only if the company is willing to close around the UK or if the Competition Markets Authority (CMA) is willing to negotiate some form of remedy. The UK regulator moved to block Microsoft’s proposed acquisition in April, and Microsoft is currently appealing that decision with a hearing set to start on July 28th.

The CMA confirmed the decision in a statement to The Verge, noting that the regulator is “ready to consider any proposals from Microsoft to restructure the transaction in a way that would address the concerns set out in our Final Report.”

The Competition Appeal Tribune (CAT) will need to approve or deny this request, but it’s more than likely that it will be approved to allow both parties to negotiate further.

In my opinion, it appears that the Microsoft -Activision acquisition has a good chance of happening. The CMA appears to want to work with Microsoft to come to some sort of agreement. If this goes well, Microsoft will have one more country that approves the acquisition.

Microsoft Confirmed June Outlook Outage Was Caused By DDoS Attacks

Microsoft,

Earlier this month, a group known as Anonymous Sudan took credit for a service outage that disrupted access to Outlook, OneDrive and a handful of other Microsoft online services, Engadget reported.

After initially sharing little information about the incident, the company confirmed late Friday had been the target of a series of distributed denial-of-service attacks.

Microsoft posted information titled: “Microsoft Responds to Layer 7 Distributed Denial of Service (DDoS) Attacks”. From their post:

Beginning in early June 2023, Microsoft identified surges in traffic against some services that temporarily impacted availability. Microsoft promptly opened an investigation and subsequently began tracking ongoing DDoS activity by the threat actor that Microsoft tracks as Storm-1359.

These attacks likely rely on access to multiple virtual private servers (VPS) in conjunction with rented cloud infrastructure, open proxies, and DDoS tools.

We have seen no evidence that customer data has been accessed or compromised.

This recent DDoS attack targeted layer 7 rather than 3 or 4. Microsoft hardened layer 7 protection including tuning Azure Web Application Firewall (WAF) to better protect customers from the impact of similar DDoS attacks. While these tools and techniques are highly effective mitigating the majority of disruptions, Microsoft consistently reviews the performance of its hardening capabilities and incorporates learnings into refining and improving their effectiveness…

…Microsoft assessed that Storm-1359 has access to a collection of botnets and tools that could enable the threat actor to launch DDoS attacks from multiple cloud services and open proxy infrastructures. Storm-1359 appears to be focused on disruption and publicity.

Storm-1359 has been observed launching several types of layer 7 DDoS attack traffic:

HTTP(S) flood attack – This attack aims to exhaust the system resources with a high load of SSL/TLS handshakes and HTTP(S) requests processing. In this case, the attacker send a high load (in the millions) of HTTP(S) requests that are well distributed across the globe from different source IPs. This causes the application backend to run out of compute resources (CPU and memory).

Cache bypass – This attack attempts to bypass the CDN layer and can result in overloading the origin servers. In this case, the attacker sends a series of queries against generated URL’s that force the frontend layer to forward all the requests to the origin rather than serving from cached contents.

Slowloris – This attack is where the client opens a connection to a web server, requests a resource (e.g., an image), and then fails to acknowledge the download (or accepts it slowly). This forces the web server to keep the connection open and the requested resource in memory.

Bleeping Computer reported that while Microsoft tracks the threat actors as Storm-1359, they are more commonly known as Anonymous Sudan.

According to Bleeping Computer, Anonymous Sudan launched in January 2023, warning that they would conduct attacks against any country that opposes Sudan.

Since then, the group has targeted organizations and government agencies worldwide, taking them down in DDoS attacks or leaking stolen data…

…In June, Anonymous Sudan turned their attention to Microsoft, where they began DDoS attacks on web-accessible portals for Outlook, Azure, and OneDrive, demanding $1 million to stop the attacks.

In my opinion, people who engage in DDoS attacks against big companies because they are angry about something are misguided. Big companies like Microsoft tend to have the tools to put a stop to DDoS attacks.

FTC Files To Block Microsoft-Activision Acquisition As Deadline Approaches

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The U.S. Federal Trade Commission (FTC) on Monday applied for a temporary restraining order and preliminary injunction seeking to block Microsoft’s acquisition of Activision Blizzard before the deal’s July 18 deadline, CNBC reported.

According to CNBC, the FTC said it fears that should Microsoft be allowed to buy Activision, Microsoft would have the power to “withhold or degrade” Activision’s gaming products, through price, game quality, experience on competitors’ offerings, or “withholding content from competitors entirely.”

In other words, the FTC is worried that Microsoft could withhold popular games from Activision Blizzard’s library from launching on other game consoles, like those sold by Sony. Or it could charge more for the games that launch on other consoles.

Call of Duty is one title that has come up and, while it’s currently available across platforms and Microsoft has promised to continue to sell that series of games broadly, regulators fear that Microsoft could have the power to hold those or similarly popular future titles for Xbox, taking buyer away from Sony and other console makers, CNBC reported.

The Verge reported that the Federal Trade Commission filed a complaint on Monday seeking to get the restraining order and a preliminary injunction. If the courts grant the injunction as well, the FTC would have a chance to make its legal case before any deal can be done.

As a result of today’s order, Microsoft and Activision cannot complete the acquisition until “after 11:59 p.m. Pacific Time on the fifth business day after the Court rules on the FTC’s request for a preliminary injunction” or a date se by the court (whichever is later), The Verge reported.

The court has also set an evidentiary hearing on the preliminary injunction for June 22nd and 23rd, so its extremely unlikely these companies will close the transaction this month.

The Verge posted the preliminary injunction on its website.

The Wall Street Journal posted a quote. “We welcome the opportunity to present our case in federal court,” said Microsoft Vice Chair and President Brad Smith in a statement following earlier reports of the FTC’s plans. “We believe accelerating the legal process in the U.S. will ultimately bring more choice and competition to the market.”

According to The Wall Street Journal, if a judge denies the injunction, it would be a blow to the FTC’s assertion that the Microsoft-Activision deal is illegal. The commission could continue its separate, in-house lawsuit, but the FTC more often drops its opposition to a deal if a judge denies an injunction.

Personally, I think it’s best to just wait and see what the court decides. We will hear the outcome eventually. I feel like this whole issue keeps going around and around with the FTC and also the UK’s CMA. Something has to give.

Xbox Offers Access To More Games For NVIDIA GeForce Now Players

Microsoft,

Xbox announced an exciting future for players and game creators, including dozens of new games, a new 1TB Series S console and new ways for players to get their games anywhere with PC Game Pass coming to NVIDIA GeForce NOW later this year.

“Our ambition is to release at least four first-party games a year – although we’ll balance that out with careful consideration for each project’s needs. That’s on top of the work our teams are doing to grow our existing communities that we’ve fostered over many years like The Elder Scrolls Online, Sea of Thieves, Minecraft, Forza, and so on.” Xbox wrote.

Xbox also mentioned its Starfield Direct game, “which will have a simultaneous release on Xbox Series X|S, PC, and Steam – with Game Pass day one on Xbox, PC and Cloud – it’s our belief that Starfield will become the most-played Bethesda Game Studios title, ever. Bethesda Game Studios has built on the Xbox development platform for a long time, and now that Bethesda is part of the Xbox family, we’ve been able to support them more than ever – and its allowed the team to create the most ambitious game in the studio’s history, inside their first new universe for her 25 years.”

The biggest part of Xbox’s press release is this:

Today we shared that Game Pass members will soon be able to stream select PC games from the library through NVIDIA GeForce NOW. This will enable the PC Game Pass catalog to be played on any device that GeForce NOW streams to, like low spec PCs, Macs, Chromebooks, mobile devices, TVs, and more, and we’ll be rolling this out in the months ahead…

The Verge reported that Microsoft is planning to bring PC Game Pass titles to NVIDIA’s GeForce Now streaming service. “You’ll be able to play your PC Game Pass catalog on all the devices supported by NVIDIA’s GeForce Now,” said Sarah Bond, head of Xbox creator experience.

“This will enable the PC Game Pass catalog to be played on any device that GeForce Now streams to, like low spec PCs, Macs, Chromebooks, mobile devices, TVs, and more, and we’ll be rolling this out in the months ahead,” said Joe Skrebels, Xbox Wire editor in chief, in a blog post.

The Verge noted that GeForce Now members will be able to “stream select PC games from the library,” so it doesn’t look like it will be the full catalog. Either way, this is a big deal for cloud gaming, allowing PC Game Pass subscribers to use Nvidia’s superior game streaming service with RTX 4080 levels of performance.

The Verge also reported that in their own testing, they found the RTX 4080 tier of GeForce Now was far superior to Microsoft’s own Xbox Cloud Gaming offering for performance and latency.

Personally, I’m in favor of giving players access to more games through Xbox S|X. I play several games on my Xbox S. That said, it appears that the release of more Bethesda games through Xbox is limited to people who have NVIDIA GeForce Now.

EU Commission To Approve Microsoft’s Activision Blizzard Acquisition

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EU antitrust regulators are set to approve Microsoft Corp’s $69 billion acquisition of Activision next week, with May 15 as the likeliest date, people familiar with the matter said, Reuters reported.

The European Commission’s imminent clearance comes nearly three weeks after the UK competition authority blocked the deal, the biggest-ever deal in gaming, over concerns it would hinder competition in cloud gaming.

The EU antitrust enforce is expected to clear the acquisition after Microsoft agreed to licensing deal with cloud streaming rivals including Nvidia, Ukraine’s Boosteroid, and Japan’s Ubitus, other people with direct knowledge of the matter told Reuters in March.

It also has an agreement with Nintendo to bring Activision’s Call of Duty to its gaming platforms should the acquisition go through, U.S. distributor Valve Corp, owner of the world’s largest video game distribution platform, Steam, declined a contract saying it trusts Microsoft.

The Commission, which has set a May 22 deadline for its decision, declined to comment.

VideoGamesChronicle reported that the European Commission has confirmed plans to publish its verdict by May 22, and it has previously been claimed that Microsoft’s willingness to offer game licensing deals to rivals is likely to address its antitrust concerns.

According to VideoGamesChronicle, last month, the UK’s Competition and Markets Authority (CMA) said it was preventing the deal due to concerns about its impact on the future of the cloud gaming market.

Microsoft and Activision quickly confirmed their intention to appeal the CMA’s ruling, which the former had called “bad for Britain” and the latter has labeled “irrational”.

Microsoft has reportedly hired a lawyer known for repeatedly defeating the EU regulator in competition cases to lead its appeal against the CMA’s decision.

Windows Central appears to be skeptical about the outcome, and posted a headline titled: “This report says the EU will approve Microsoft’s Activision deal for Xbox, but will it?”

Windows Central wrote: Microsoft is currently in the process of trying to acquire Activision-Blizzard-King, makers of Call of Duty, World of Warcraft, and Candy Crush Saga. The deal has been fraught with regulatory scrutiny, with Sony PlayStation decrying the deal to regulators across the globe.

The UK regulatory arm known as the CMA blocked the deal a few weeks ago, Windows Central wrote, claiming that it would give Microsoft a monopoly in this very, very nascent market – a market in which Microsoft says it can only serve to 5,000 concurrent users in the UK.

In my opinion, anyone who has been paying close attention to the Microsoft – Activision Blizzard acquisition has been on an emotional roller coaster, waiting to see what the various regulators of different countries will decide. I’m hoping the EU antitrust regulators will approve of the acquisition.