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Approved: The EU gives Microsoft’s acquisition of Activision Blizzard the go ahead

The EU’s decision puts it at odds with the UK and USA

Approved: The EU gives Microsoft’s acquisition of Activision Blizzard the go ahead

The EU has approved Microsoft’s acquisition of Activision Blizzard - a deal which, if closed, would be the biggest acquisition in gaming history at $68.7 billion.

The deal has come under criticism from legislators and competitors alike, and as such has faced significant hurdles. The USA’s Federal Trade Commission (FTC) sued to block the deal in December due to its concerns about how it would affect competitors, while the UK’s Competition and Markets Authority (CMA) opted to block the deal last month due to its concerns regarding how the move would affect competition in the cloud gaming sphere - a decision Microsoft is appealing.

With Microsoft facing a battle on two fronts to close the deal, the European Commision’s (EC) decision is likely to come as welcome news. Notably, while the EC’s preliminary investigation found that the deal could harm competition in cloud gaming - the very field which led to the CMA blocking the deal - it stated today that it had accepted Microsoft’s proposed remedies, namely the issuing free licences to cloud gaming providers to allow European gamers to stream Activision Blizzard titles on their platform of choice for at least the next ten years.

“These commitments fully address the competition concerns identified by the commission and represent a significant improvement for cloud game streaming compared to the current situation,” writes the commission.

What does this mean for the deal’s future?

While the deal’s completion remains somewhat uncertain - after all, two of the world’s foremost gaming markets have made moves to block the deal - the EU’s approval means that there's life in the deal yet, wheras a EU ban would almost certainly have finished it off.

EDHEC business school professor of antitrust law Anne Witt told The Guardian that this decision could help Microsoft’s case as it appeals the CMA’s decision, however Witt stressed that should the CMA maintain its current objections to the acquisition, the deal could still be abandoned.

“It makes a difference if they manage to get the decision overturned in the UK Competition Appeal Tribunal. But if Microsoft loses in the UK it’s still game over unless Microsoft decides to withdraw from the UK market,” said Witt.

Likewise, The Guardian notes that while the FTC is attempting to block the deal, legal experts have argued that it faces an uphill battle to do so based on historical precedent.

While things may be looking up for Acquiblizz, the future isn’t set in stone, and a final ruling against the deal by either the CMA or FTC could still see the deal scuppered.

In a notice to shareholders, Activision Blizzard stated that the companies were likely to terminate the deal rather than step away from key markets, stating that the deal could be abandoned if “any action has been taken by any governmental authority of competent jurisdiction, that … prohibits, makes illegal or enjoins the consummation of the merger and has become final and non-appealable.”

In short, while one battle has been won, the war continues - and both the FTC and CMA may prove harder to convince.

We listed Activision Blizzard as one of the top 50 mobile game makers of 2022.

 


Staff Writer

Lewis Rees is a journalist, author, and escape room enthusiast based in South Wales. He got his degree in Film and Video from the University of Glamorgan. He's been a gamer all his life.