Europe Approves the Activision-Blizzard Acquisition

The European Commission, known as the EC, has officially green-lighted Microsoft’s suggested acquisition of Activision, the colossal gaming titan, with a whopping offer of $68.7 billion.

This announcement arrived shortly as the CMA, UK’s regulatory body, raised objections against this transaction. On the other side of the Atlantic, the Federal Trade Commission, or FTC, in the United States is actively taking legal actions to prevent this deal from going through.

Europe has considered conducting an extensive investigation into the acquisition for a while. As early as November, it had voiced concerns that the prospective merger of Microsoft and Activision might decrease competitiveness in the video game industry, affecting both console and PC markets. The European Commission, or EC, initially planned to make its decision known by the 25th of April. However, this deadline was extended when Microsoft provided additional solutions and pledges, causing the EC to delay its final decision.

It’s important to mention that Microsoft has made several promises to maintain the presence of Activision’s games on competing platforms. These include major players like Sony, Nintendo, and Nvidia, and Microsoft has committed to this for a decade. Despite these assurances, the CMA, or Competition and Markets Authority, has argued that Microsoft’s proposed solutions fall short of reproducing the current level of “competitive dynamism” in the market.

While Europe has consistently been an engaged participant in regulating big tech companies and curbing anti-competitive misconduct, it hasn’t generally been a major advocate for halting mergers and acquisitions within the tech sphere, except for the telecommunications industry. Therefore, the findings released today align quite closely with their established pattern of behavior.

The verdict from the European Commission comes a few months after Japan also gave its stamp of approval for the deal. However, Europe has explicitly stated its intention to institute measures to monitor how Microsoft’s future actions might affect its competitors in the gaming industry.

This is a big win for Microsoft, and while the US doesn’t look too happy about this acquisition, it remains to be seen if the FTC will approve this merger.