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Microsoft And FTC Haven't Had "Substantive" Settlement Talks In Activision Case, Lawyer Says

Microsoft offering up concessions could be one way to help the deal get done.

The United States government is suing Microsoft over its proposed acquisition of Activision Blizzard, and the first pre-trial hearing took place this week. As part of the proceedings, a lawyer for the Federal Trade Commission said Microsoft and the FTC have yet to engage in any "substantive" discussions about a potential settlement deal in the high-profile case, according to Reuters.

A settlement of some kind is one of the potential outcomes in this case. Microsoft could, for example, agree to make some concessions to help appease the FTC and close the deal, but what those concessions could be is anyone's guess at this stage.

The FTC lawyer, James Weingarten, said only that there have not been any "substantive" talks between Microsoft and the government about a potential settlement. The word substantive is open-ended, and it's possible the two sides have talked and that whatever Microsoft might have offered doesn't meet the FTC's definition of "substantive." Or it's possible the two sides have not communicated at all in terms of a possible settlement. After all, Microsoft president Brad Smith made it clear that Microsoft believes in its position and would rigorously pursue the case in court.

"While we believe in giving peace a chance, we have complete confidence in our case and welcome the opportunity to present it in court," Smith said in December.

Smith also said at the time that Microsoft remains interested in working with the FTC to address concerns around competition. Smith said Microsoft offered concessions to the FTC in December, though what those concessions were are unclear.

The FTC law judge Michael Chappell will pass down a ruling following hearings that are scheduled for August 2023, barring any settlement that could come before then. If the case does advance all the way through an official trial, the decision can be appealed by either side with the FTC, and after that, it can be appeared in US Appeals Court.

In addition to the ongoing case in the United States, Microsoft's proposed deal to buy Activision Blizzard is being invested in the EU, which will pass down a ruling by March 23.

Microsoft has said its main reason for trying to buy Activision Blizzard is not to make Call of Duty exclusive to Xbox but to acquire Candy Crush from Activision Blizzard and gain a foothold in the increasingly lucrative mobile games space.

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