The EU Commission has approved Microsoft’s planned acquisition of Activision Blizzard. From the point of view of the antitrust authorities, there is nothing to prevent Microsoft from acquiring the US publisher with well-known games such as “Call of Duty” and “World of Warcraft” for 69 billion US dollars as planned.
The decision of the EU antitrust authorities was expected after positive signals in the past few months. Microsoft had previously made concessions and signed contracts with several competing companies, including cloud gaming providers. Microsoft also pledged to license current and future Activision Blizzard games to all cloud gaming providers
another that will allow any European gamer to play any current or future Activision Blizzard PC game on any streaming platform
“These commitments fully address the competition concerns identified by the Commission and represent a significant improvement for cloud gaming compared to the current situation,” sums up the EU Commission in its justification. No deterioration is to be feared on the console market either, it is said. Because competitor Sony sells significantly more consoles than Microsoft, the company has a great incentive to continue offering titles developed by Activision, such as “Call of Duty”, on the Playstation.
The EU closes with its decision Antitrust authorities in countries such as Brazil, Chile, Serbia and Saudi Arabia, who also think the deal is harmless.
CMA blocks the takeover
The British Competition and Markets Authority (CMA) sees things differently: the British antitrust authority recently decided not to allow Microsoft’s planned takeover of Activision Blizzard. Microsoft has not managed to dispel concerns about supremacy in the cloud gaming sector, writes the CMA in its justification. The deal would mean less competition and therefore less innovation, it continues.
Despite the EU decision, it is uncertain that Microsoft will be able to complete the takeover. Microsoft has announced that it will appeal the CMA’s decision to the UK’s Competition Appeal Tribunal (CAT). “We want to continue buying Activision Blizzard and will appeal,” Microsoft President Brad Smith wrote on Twitter after the CMA’s decision. The verdict reflects an incorrect understanding of the gaming market.
The bar of the CAT, to overrule decisions of the British competition authorities, is considered comparatively high. The hearing at the CAT could take up to 9 months. Should Microsoft be granted, the case would then end up again with the CMA. Resistance to the takeover also comes from the United States, where the responsible Federal Trade Commission (FTC) has decided to file a lawsuit against the deal.
Sony fights back
With the deal, Microsoft wants to consolidate its market position in the gaming industry. It would be the most expensive acquisition in the history of the tech giant. With Activision Blizzard, Microsoft could not only strengthen its console and subscription businesses, but also expand its presence in the mobile market. Activision Blizzard also owns the extremely successful mobile department King, which has produced titles such as “Candy Crush”. Microsoft wants to complete the takeover by summer at the latest.
One of the vehement opponents of the takeover is Microsoft competitor Sony. The Playstation manufacturer describes the deal as anti-competitive. Microsoft could raise prices after the takeover, which could harm independent developer studios, the Japanese company argues in letters to antitrust authorities. The “Call of Duty” series developed by Activision is irreplaceable because of its huge reach. According to Sony, a “significant” part of Playstation users would switch to Microsoft in the medium term if the takeover including “Call of Duty” games were to be approved.
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