The US FTC still believes that the Microsoft-Activision merger is a "threat to market competition"

Microsoft has officially acquired Activision Blizzard, but U.S. regulators still oppose the deal, calling it a "threat to competition." The U.S. Federal Trade Commission (FTC) had previously tried to block the deal, but a judge was successfully persuaded by Microsoft. The FTC is further appealing the acquisition at the federal level after an earlier appeal was denied, and the acquisition will continue to be a focus of the agency.

An FTC spokesperson told DEADLINE: "Although Microsoft and Activision Blizzard completed the transaction prior to the December appeals court hearing, we continue to monitor the federal appeals process."

The FTC said Ubisoft's deal with Microsoft to sell its cloud gaming rights "brings a completely new fact to the merger" that could affect U.S. consumers. A spokesman said this would be assessed as part of the ongoing appeals process. "The FTC continues to believe that this transaction poses a threat to competition," the agency said.

Microsoft has sold Activision Blizzard cloud gaming rights to Ubisoft to help convince the UK regulator (CMA) to approve the deal. As part of the agreement, Ubisoft permanently acquires cloud gaming rights to existing Activision Blizzard games and all future titles for the next 15 years.

Microsoft currently owns all Activision Blizzard IP, including "Call of Duty" and "World of Warcraft".

Current Activision Blizzard CEO Bobby Caudick will continue to serve until the end of 2023, reporting directly to Xbox head Phil Spencer. The "golden parachute" for his departure is as high as $400 million or more.

An appeal hearing between the FTC and Microsoft will be held on December 6.