Microsoft’s Activision Blizzard deal complicates Big Tech regulation – Axios

Microsoft's surprise $68 billion deal to buy Activision Blizzard is adding a fresh twist to the heated debate over which tech companies have monopolies that need to be reined in.

The big picture: The deal could force a question the company has happily ducked for a decade: whether its size and power make it just as deserving of regulatory scrutiny as its Big Tech rivals.

Why it matters: Regulators have finite resources and will have to prioritize which companies and deals they want to contest.

Flashback: Microsoft, of course, spent years fighting a Justice Department antitrust suit two decades ago but in the most recent wave, regulators have largely focused on Apple, Google, Amazon and Facebook.

Between the lines: Microsoft will argue that, in the mobile age, Apple and Google hold a dominant market position with their tight control over mobile app stores.

The key question is how the regulators at the Federal Trade Commission and other agencies, who will ultimately decide whether the deal can go forward, choose to define the markets it affects.

Of note: On Tuesday the Justice Department and Federal Trade Commission announced the start of a process that will ultimately result in rewritten merger guidelines, which could translate as more hurdles for large deals.

Be smart: A good antitrust case, or a decision to block a deal, isn't determined by people's feelings or a company's size. It's about whether a company has, or with acquisitions could gain, undue control over a relevant market.

Microsoft is counting on the fact that even with the deal, it will have less than 15% of video game industry revenue, trailing both Tencent and Sony. But regulators may choose not to look at the broad "gaming" market as a whole, and instead distinguish between mobile, console, PC and cloud gaming.

Between the lines: Microsoft hasn't entirely escaped the latest tech antitrust surge, with some critics raising concerns about its move to integrate Teams into Office and Windows.

What they're saying: Rep. Ken Buck (R-Colo.), whose office has been pushing tighter regulation of other Big Tech companies, says conversations with Microsoft were "encouraging," while noting the deal still faces agency review.

Public Citizen is calling for regulators to quash the deal.

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Microsoft's Activision Blizzard deal complicates Big Tech regulation - Axios