Microsoft's $68.7-Billion Takeover Of Activision Blizzard Gets EU Approval

The European Commission also acknowledged that Microsoft's acquisition could pose a threat to competition in the distribution of games.

Microsoft initially announced its intention to acquire Activision, one of the world's most prominent video game publishers, in January 2022. ( Image Source :Getty )

The European Commission has granted approval, in accordance with the EU Merger Regulation, for Microsoft's proposed acquisition of gaming giant Activision Blizzard for a total of $68.7 billion. The decision was made following a thorough investigation that considered extensive feedback and information from competitors, customers, game developers, distributors, and cloud game streaming platforms within the EU.

During the preliminary investigation, it was determined that Microsoft's acquisition could potentially harm competition in the distribution of console and PC video games, including multi-game subscription services and cloud game streaming services, as well as in the supply of PC operating systems. However, the in-depth market investigation revealed that Microsoft's actions would not adversely affect rival consoles or multi-game subscription services.

Nevertheless, the European Commission acknowledged that Microsoft's acquisition could pose a threat to competition in the distribution of games through cloud game streaming services and could further strengthen its position in the PC operating systems market.

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This decision by the European Union comes after the UK market regulator previously announced its decision to block Microsoft's proposed acquisition of Activision Blizzard. The European Commission's findings indicated that Microsoft would have no incentive to refuse the distribution of Activision's games to Sony, the leading console game distributor globally, including in the European Economic Area. Given the popularity of Sony's PlayStation consoles, Microsoft would be motivated to continue distributing Activision's games through this widely used device.

If Microsoft were to make Activision's games exclusive to its own cloud game streaming service, it could potentially enhance Windows' position in the PC operating systems market. However, the decision noted that Microsoft should not hinder or degrade the streaming of Activision's games on PCs using operating systems other than Windows.

Microsoft initially announced its intention to acquire Activision, one of the world's most prominent video game publishers, in January 2022, sealing the deal for $68.7 billion.

Overall, the European Commission's approval of the acquisition took into account potential competition concerns while recognizing the importance of maintaining a fair and competitive market for the distribution of video games and PC operating systems.