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Sony and Activision Blizzard Lobby Congress for Support in Microsoft Acquisition

Sony Interactive Entertainment, a subsidiary of Sony, has entered the lobbying world to express concerns about competition in the gaming industry following Microsoft's $69 billion acquisition of gaming developer Activision Blizzard. Sony Interactive Entertainment spent $60,000 in the fourth quarter of 2022 and an additional $240,000 in the first half of 2023 lobbying federal lawmakers and government agencies to support antitrust law enforcement.
Meanwhile, Activision Blizzard has increased its lobbying efforts, hiring a firm to lobby Congress on gaming competition and workforce issues. The company has also increased the number of its lobbyists from seven in 2022 to 16 in 2023, with the majority being former federal employees.
Activision Blizzard's increased lobbying activity can be attributed to concerns raised by lawmakers and the U.S. Equal Employment Opportunity Commission regarding the impact of the merger on the company's workers. Activision Blizzard settled an $18 million lawsuit alleging gender-based harassment and discrimination prior to the merger announcement.
In the first half of 2023, Activision Blizzard spent $420,000 on lobbying, surpassing its 2022 spending. Microsoft, the producer of Xbox gaming consoles, has also been actively lobbying on issues of antitrust and competition, spending $4.5 million on federal lobbying in the first half of 2023.
The merger between Microsoft and Activision Blizzard faced legal challenges from the Federal Trade Commission (FTC), but a federal appeals court rejected the FTC's motion to block the deal. While the companies have cleared all remaining U.S. regulatory hurdles, approval from international agencies is still pending.
The New Zealand Commerce Commission approved the acquisition, leaving the United Kingdom and Australia as the final holdouts. The U.K.'s Competition and Markets Authority has expressed concerns about the acquisition's impact on gaming choices and prices, while Sony has warned about potential revenue losses if Microsoft makes Call of Duty exclusive to Xbox. However, the agency's reversal in its assessment and continued investigation of the deal's effect on competition in the cloud-gaming market led to the blocking of the deal.
Despite these challenges, Microsoft and Sony reached a 10-year deal to keep Call of Duty games available on PlayStation consoles, potentially paving the way for the completion of the deal in October.