By: Hamza
Date: Tuesday May 16, 2023
Game On! EU Greenlights Microsoft's Epic Acquisition of Activision Blizzard
European regulators approve Microsoft's acquisition of Activision Blizzard, allowing expansion into the cloud gaming market
European regulators have approved Microsoft's $69 billion acquisition of Activision Blizzard, marking an important step forward for the tech giant. According to the European Commission, despite difficulties encountered in other countries, the concessions Microsoft made were deemed sufficient to address antitrust concerns related to the agreement. This approval makes Microsoft the third largest game publisher in the world, behind Tencent and Sony. While the impact of the merger on competition, especially in the burgeoning cloud gaming sector, remains a concern, Microsoft's commitments have been recognized by the Commission as a significant improvement.
Minimize antitrust concerns:
To address competition concerns raised by European regulators, Microsoft has made a number of concessions. One key commitment is to allow European consumers to play Activision's titles on any cloud game service for ten years. In addition, Microsoft is committed to not degrading the quality or content of its games on competing streaming platforms. These measures have helped alleviate antitrust concerns related to mergers, as stated by the European Commission. The significance of these commitments lies in their ability to improve the cloud game streaming landscape, giving consumers more choices and benefits than in the current scenario.
Global Meaning:
Microsoft's commitment to the game streaming aspect of the deal extends beyond the European Union. The European Commission has mandated Microsoft to license popular Activision Blizzard games automatically to competing cloud gaming services, ensuring that this practice is implemented worldwide. Microsoft President Brad Smith expressed the company's dedication to empowering millions of consumers worldwide, allowing them to play these games on any device they prefer. This global approach underscores Microsoft's intention to expand its influence and provide a more inclusive gaming experience for players across the globe.
Challenges in Other Jurisdictions:
Despite securing regulatory approval in Europe, Microsoft's acquisition of Activision Blizzard is facing challenges in the United States and the United Kingdom. The concerns raised in these jurisdictions are likely to be addressed separately, emphasizing the need for Microsoft to navigate complex regulatory landscapes to complete the merger successfully. However, approval from European regulators is a positive step for the deal, highlighting Microsoft's concessions and its commitment to addressing competition concerns.
Response from Activision Blizzard:
Activision Blizzard CEO Bobby Kotick has responded to the requirements imposed by European regulators, calling them "rigorous". In a statement, Kotick underscored the company's commitment to increasing investment in workers across the European Union, highlighting the skills, ambition and government support available in countries around the world. Countries include Sweden, Spain, Germany, Romania, Poland and others. Kotick expressed his optimism for the development and prosperity of these teams, and welcomed the pragmatic approach of European governments towards the gaming industry.
The approval by European regulators of Microsoft's acquisition of Activision Blizzard is an important development for both companies. Microsoft's commitments to cloud gaming services effectively addressed the competition concerns raised during the review. Microsoft's expansion of influence in the gaming industry, especially in the cloud gaming sector, is expected to create new opportunities for gamers around the world. While demanding situations continue to be within the US and UK, European approval sets a tremendous precedent for the realization of the agreement. Activision Blizzard's commitment to European workers and their continued growth reflects the potential for a mutually beneficial partnership. As the merger progresses, stakeholders will closely monitor the evolving regulatory landscape to assess the long-term impact on the gaming industry.