When President Biden took office, he sent several signals that he was willing to take on growing corporate concentration. Among the clearest was the appointment of consumer advocate Lina Khan—a prominent critic of monopoly power—to lead the Federal Trade Commission.

Instead, the takeovers continued under Biden’s watch. Last week brought the latest evidence that reducing corporate concentration will be more difficult than Biden may have hoped: US courts rejected the FTC’s attempts to prevent Microsoft from absorbing the video game company Activision Blizzard. Microsoft could end the deal in the coming months; a key deadline was extended this week.

The merger would be by far the largest ever in video games, after adjusting for inflation. The gaming industry now accounts for significant parts of the economy. It is bigger than music, American book publishing and North American sports combined. The gaming division of Microsoft and Activision Blizzard each make more money each year than all of the US movie theaters. The two companies are among the biggest in games, as this chart from my colleague Ashley Wu shows:

The FTC said the Microsoft-Activision merger was anti-competitive and sued to stop it. The agency argued that the merger would give Microsoft, creator of the game console Xbox, too great an advantage over its rival Sony, the producer of PlayStation. Of particular interest was Activision’s massive franchise, Call of Duty. A new release of Call of Duty is consistently one of the best-selling games on Xbox and PlayStation every year. But if Microsoft owns Call of Duty, it could make the game exclusive to Xbox and rob Sony of one of gaming’s biggest attractions.

To address those concerns, Microsoft promised that it would put Call of Duty games on PlayStations for 10 more years. That was one reason the courts ruled against the FTC: They found the agency hadn’t shown the deal was likely to hurt competition.

With their ruling, the courts allow another large merger that will further consolidate a major industry. Many experts say that trend ultimately hurts consumers by reducing the kind of competition that lowers prices and improves quality for goods and services, even if the FTC could not prove all of this in this case.

Let’s move away. In the past few decades, markets have become more concentrated. The largest companies dominate most industries, as this chart shows:

Why is this important? In simple terms, lack of competition allows companies to lower wages, increase prices and dilute the quality of their products. A classic example is internet service: Many Americans live in areas with only one or two providers. These companies keep prices high, the internet can be spotty and the customer service is often poor. Because customers have no alternatives, suppliers can get away with these failures.

Corporate concentration deepens such a problem, say experts. One economist concluded that market concentration costs the typical American household more than $5,000 a year. Progressives like Khan have argued that regulators need to take the issue more seriously.

The Biden administration released guidelines this week that aim to strengthen antitrust law that limits anti-competitive practices. Under Khan, the FTC also pushed courts to effectively lower the burden of proof necessary to show that a merger is anticompetitive. There is merit to that approach, some experts argue: American courts have raised the bar very high in recent decades, surpassing standards in Britain and much of Europe.

“We can convict someone and send them to prison for murder based on circumstantial evidence,” said Douglas Melamed, an antitrust expert at Stanford Law School. “But it often seems that courts won’t let plaintiffs win an antitrust case based on circumstantial evidence.”

The FTC has yet to persuade the courts to relax their standards. The loss of the agency in the case of Microsoft-Activision is the latest example. Nor did it block Meta’s acquisition of virtual reality company, Within. And it even lost in its own administrative court, which ruled in favor of the gene-sequencing company Illumina in its acquisition of the company Grail.

Khan’s issue still has potential. The last major change in antitrust law, in the 1970s, came after decades of work by conservatives to push the law and courts in their direction. The movement that Khan helped popularize among progressives is only a few years old. If it persuades more of the public and, most importantly, judges, it could eventually succeed.

Related: The FTC’s defeats raised new questions about Khan’s strategy. “All these court losses make their threats look more like a paper tiger,” said one executive.

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