Summary
- FTC slams Microsoft for changes to Xbox Game Pass, calling new standard tier a "degraded product" that costs consumers 36% more.
- Despite court approval, FTC remains vocal about Microsoft's decisions post-Activision Blizzard merger, citing consumer harm and market power.
- Recent Game Pass price hikes and tier changes prompt FTC to continue crusade against acquisition.
The United States Federal Trade Commission has submitted a new court filing about the recent price hikes and major changes to Xbox Game Pass, wherein it slams Microsoft for "degrading" the subscription service. The American consumer protection watchdog has been engaged in a legal back-and-forth with Microsoft since its proceedings to acquire Activision Blizzard King, and the FTC seemingly remains intent on reversing the merger.
While Microsoft's $68.7 billion acquisition of Activision Blizzard King was approved without much friction in regions like Australia, the Middle East, and Europe, the trillion-dollar corporation faced fierce recoil in its home country. The FTC filed an injunction to block the Activision Blizzard acquisition back in June 2023, but the federal court trial swayed in Microsoft's favor and the merger eventually went through in the following months. Even though the FTC was unsuccessful in its efforts, the antitrust custodian has been quite vocal about Microsoft's decisions regarding Activision Blizzard's integration into the business.
Microsoft Responds to FTC Complaints About Activision Layoffs
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The recent price hikes and changes to Xbox Game Pass gave the FTC another opportunity to express its disdain at the Activision Blizzard merger, and it seems to have involved the US legal system again. In a new filing to the Ninth Circuit Court of Appeals, the FTC derides Microsoft for removing day one first-party titles from the standard Game Pass for Console tier (for new subscribers) and locking them only to the service's costliest Ultimate tier. Coupled with the price increases across the board, the FTC refers to the new Game Pass Standard tier as a "degraded product" that consumers have to pay 36% more for.
Microsoft Went Back on its Claims About Game Pass Price Hikes, Says FTC
The FTC additionally notes in the filing that this is "exactly the sort of consumer harm from the merger" that the antitrust commission wanted to stop in the first place, and that the new Game Pass changes are "the hallmarks of a firm exercising market power post-merger." It also brings up Microsoft's contradictory claims about Game Pass prices not being increased after the Activision Blizzard deal, although the company did specify that prices wouldn't go up "as a result of the acquisition." The deliberate wording may give Microsoft enough plausible deniability to evade the allegations, but that remains to be seen.
Microsoft has yet to respond to these complaints, but with this new filing, the FTC continues its crusade against the Activision Blizzard acquisition. The exact reason behind the recent Game Pass price hikes is unclear, but the leading theory for now is the highly anticipated addition of Call of Duty Black Ops 6 to the service this October.
- Date Founded
- April 4, 1975
- Headquarters
- Redmond, Washington, United States
- CEO
- Satya Nadella
- Subsidiaries
- activision blizzard, Microsoft Studios, Mojang Studios, Microsoft Game Studios, Xbox Game Studios
- Consoles
- Xbox, Xbox One, Xbox 360, Xbox One X, Xbox Series X, Xbox Series X|S
- Services
- Xbox Game Pass
- Known For
- Xbox