According to sources speaking with The Information, last week the FTC began seeking more information about the deal in an investigation that could potentially delay its closing by six months or even more. Though a closing date wasn't announced alongside the initial announcement, The Information reports it could be pushed into early 2023.
The FTC is reportedly focused on concerns that Sony might be motivated to prevent competing companies and services, such as Xbox, from accessing Bungie's games such as Destiny 2. That means examining how popular Destiny is, and whether a possible restriction would meaningfully harm Sony's competitors and create antitrust violations. While Sony has publicly committed to keeping Bungie games cross-platform, its ability to restrict both current titles and future releases in the future is a point of antitrust concern.
This investigation represents another sign of the FTC's recent, more aggressive approach toward potential antitrust issues in the gaming industry. While it is customary for the FTC to look into large deals, the spree of major gaming acquisition in recent years as well as the growing size of such deals appears to have prompted greater scrutiny, particularly under Biden-appointed FTC chair Lina Khan.
For instance, in February, reports suggested that the FTC was similarly investigating the planned acquisition of Activision Blizzard by Microsoft to determine whether it would harm consumers, partners, or competitors. And Khan has stood at the head of a planned crackdown on merger guidelines, and has similarly pushed a block of a planned Nvidia acquisition and reopened an antitrust case against Meta.
The FTC's investigation doesn't necessarily mean the acquisition will be meaningfully impacted, especially given the immense legal challenge required to ultimately block a deal. However, the increased scrutiny on the gaming and tech sectors will likely remain a consideration in future acquisitions as more and more major companies express interest in adding to a growing pile of internal studios and the industry is further consolidated.
The Federal Trade Commission is opening a study into Sony’s planned acquisition of Bungie, marking a large push-up in oversight of gaming mergers during a period of major industry consolidation.
According to sources speaking to The Information, last week the FTC began seeking information about the deal in an investigation that could delay its closing by six months or even more. While the date of closing wasn’t announced just before the announcement, The Information reports that it could be pushed into 2023.
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The FTC is based on concerns Sony might be motivated to prevent competitors, such as Xbox, from able to access Bungie’s games such as Destiny 2. That means examining how popular Destiny is, and determining whether a restriction would harm Sony’s competitors and create antitrust violations. While Sony announced its intention to keep Bungie games cross-platform, its ability to limit current titles and future releases is a very serious concern.
This investigation is another sign of the recent, more aggressive approach of the FTC to combat antitrust issues in the gaming industry. Although the FTC would like to look into large deals, the future of major gaming acquisitions in recent years as well as the growing size of such deals seemed to be worth a lot more scrutiny, especially under Lina Khan, who was Biden-appointed former FTC chair.
IGN took a look at every game of bungies ever. 19 Images
In February, reports suggest that the FTC was similar to studying the plans for acquiring Activision Blizzard by Microsoft to find out whether it would harm consumers, partners or competitors. And Khan was leader of a planned merger crackdown on guidelines; he pushed a block of a planned acquisition of Nvidia and reopened an antitrust case against Meta.
As a consequence of the investigation by the FTC, it does not necessarily mean that the acquisition will be badly affected, especially given the huge legal challenge which would ultimately block a deal. However, the more advanced scrutiny surrounding games and tech sectors will probably continue to play a huge role in future acquisitions as more and more major companies express interest in adding to their growing demand for internal studios and the industry is consolidated.
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