If the regulators accept Sony's point and block the merger, automatically all publishers with AAA games are off-limits to MS. Because they will be able to use the same "[AAA game]'s profits are essential to finance our first-party games" argument.Actually that thought had crossed my mind. I think a merger with T2 would see the same resistance from regulators along with maybe EA (but their biggest IP's would never be exclusive so maybe not) and Epic although for a different reason.
EA is off-limits because Fifa.
T2 is off-limits because GTA.
Ubi is off-limits because Assassin's Creed.
Capcom is off-limits because Resident Evil.
Square-Enix is off-limits because Final Fantasy.
And so on.
Microsoft will be able to buy indie studios only. Probably nothing bigger than, say, Platinum.