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Xbox wins, FTC loses again
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They have been picking their battles.
Breaking an existing company up into multiple smaller companies is an order of magnitude more difficult for a US regulator than stopping a company from buying another one. The FTC is running face first into a legal system that has methodically chipped away at anti trust law for generations. That's the obstacle here, not picking the wrong battles.
Poorly. Very poorly. Under Khan they've been an absolute shitshow of mismanagement.