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FTC Drops Microsoft–Activision Blizzard Case, Ending Challenge to $69 Billion Merger

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The U.S. Federal Trade Commission (FTC) has formally dropped its legal case against Microsoft’s $69 billion acquisition of Activision Blizzard, bringing a definitive end to one of the most high-profile antitrust challenges in the gaming industry.

The FTC announced Thursday that it would not pursue further legal action, citing that continuing the case was “not in the public interest.” The decision comes after the agency lost an appeal on May 7 to block the deal, which officially closed in 2023.

The acquisition—the largest in gaming history—gives Microsoft control over blockbuster franchises such as Call of Duty, World of Warcraft, and Candy Crush, solidifying its dominance in both console and cloud-based gaming.

Shifting Priorities Under New FTC Leadership

FTC Chairman Andrew Ferguson, recently appointed by President Donald Trump, is redirecting the agency’s focus toward matters aligned with the current administration’s priorities. This includes:

  • A probe into advertiser collusion on Elon Musk’s X platform (formerly Twitter), as first reported by Reuters.

  • Ending legacy antitrust efforts, including a price discrimination case against PepsiCo, also dropped Thursday.

This pivot marks a departure from the aggressive antitrust posture of Ferguson’s predecessor, Lina Khan, who launched the Activision challenge over concerns that Microsoft might use the acquisition to suppress competition in the gaming sector—particularly via Xbox exclusivity and its Game Pass subscription service.

Microsoft’s Response

In a statement, Microsoft President Brad Smith praised the FTC’s decision, calling it:

“A victory for players across the country and for common sense in Washington, D.C.”

Microsoft has repeatedly argued that the merger will benefit consumers, pledging to keep popular titles like Call of Duty available across platforms, including Sony’s PlayStation.

Background and Legal Outcome

Though the FTC initially failed to secure a preliminary injunction to halt the deal before closing, it retained the option to pursue a post-closing trial in July 2025 aimed at unwinding the acquisition. That option is now off the table.

The deal had already secured regulatory approval in the EU and U.K., the latter after Microsoft agreed to restructure parts of the acquisition, such as cloud gaming rights.

With the FTC now stepping aside, the merger’s legal battles appear fully resolved, cementing Microsoft’s expanded position in the global gaming industry.

FTC Appoints Former Heritage Foundation Tech Policy Expert as Chief Technology Officer

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The U.S. Federal Trade Commission (FTC) has appointed Jake Denton, a former tech policy researcher from the conservative Heritage Foundation, as its new chief technology officer. Denton, who graduated from American University in 2021, shared the news of his appointment on X on Monday. He replaces Stephanie Nguyen, who served in the role since 2022 under former FTC Chair Lina Khan.

The FTC introduced the role of chief technologist during the Obama administration to offer guidance on emerging technology policy issues, with a focus on digital markets, competition, and consumer protection. Denton’s appointment comes as Andrew Ferguson begins his tenure as the new chairman of the FTC. Ferguson has voiced concerns about the dominance of Big Tech companies but has also cautioned against over-regulating the tech industry in a way that might hinder U.S. innovation.

Denton has previously expressed his views on artificial intelligence (AI) policy, calling for Congress to pass AI legislation in a Fox News interview in July 2023. In an opinion piece co-authored with Kara Frederick, the Heritage Foundation’s tech policy director, Denton emphasized the need for the U.S. and its allies to take a leading role in setting international AI standards. They warned that if democracies don’t write the rules for emerging technologies like AI, authoritarian regimes may take the lead in shaping them.

Before joining the Heritage Foundation, Denton interned in Congress and completed a fellowship with the Federalist Society. His appointment signals the FTC’s continued focus on regulating emerging technologies like AI and digital markets, areas where the agency has launched investigations in the past under Chair Khan, particularly into AI partnerships such as Microsoft’s and OpenAI’s collaboration.

It remains to be seen whether Ferguson, along with Denton, will continue investigations into Big Tech, including ongoing probes into Microsoft and OpenAI’s potentially anticompetitive conduct and whether OpenAI violated consumer protection laws. The FTC is also preparing for a high-profile trial in April over Meta Platforms’ acquisitions of Instagram and WhatsApp, and continues to pursue legal action against Amazon over alleged anti-competitive practices.

Alphabet Hits Record High Following Trump’s FTC Chair Nomination

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Alphabet (GOOGL.O), the parent company of Google, soared to a record high on Wednesday after President-elect Donald Trump nominated Andrew Ferguson as the new chair of the Federal Trade Commission (FTC). Ferguson, a current FTC commissioner and known dissenter under outgoing chair Lina Khan, is expected to shift the agency’s approach to antitrust enforcement.

Lina Khan, whose tenure focused on stringent antitrust actions against Big Tech, brought significant regulatory pressure on firms like Alphabet, Microsoft, and Apple. Analysts believe Ferguson’s leadership may signal the end of the antitrust case against Alphabet, sparking investor optimism. “Under Ferguson, many expect a more lenient stance toward corporate power,” remarked Jay Woods, chief global strategist at Freedom Capital Markets.

Alphabet’s shares surged 5.5% to a record $195.45, leading a broader rally in Big Tech. Tesla also reached a record high, gaining 4.6%, as investors speculated on the company benefiting from CEO Elon Musk’s close ties to Trump. Other tech heavyweights followed suit: Microsoft rose 1.2%, while Amazon.com and Meta Platforms each climbed 2%.

The rally was further fueled by expectations of an interest-rate cut later this month, following a favorable inflation report. Lower interest rates are typically advantageous for growth stocks like those in the technology sector.

Alphabet’s recent stock momentum also stems from groundbreaking advancements in AI and quantum computing. Earlier in the week, the company unveiled the second generation of its Gemini artificial-intelligence model, along with innovative applications for AI beyond chatbots. These include integration with wearable technology, such as AI-enhanced eyeglasses.

Additionally, Alphabet introduced a new-generation quantum chip that addresses a critical challenge in quantum computing. “This is Alphabet cementing its position at the forefront of transformative technology,” said Michael Ashley Schulman, CIO of Running Point Capital. Jamie Meyers, a senior analyst at Laffer Tengler Investments, highlighted how Alphabet’s quantum breakthrough demonstrates its capability in hardware development, despite being perceived as trailing in AI innovation.

While Trump’s broader approach to Big Tech remains uncertain, Ferguson’s appointment has catalyzed a wave of optimism, particularly for companies like Alphabet, which have faced intense regulatory scrutiny in recent years.