EU Commission Approves Microsoft's $69B Activision Deal

Improve the News Foundation -

Facts

  • EU regulators on Monday approved Microsoft’s $69B deal for the purchase of gaming company Activision Blizzard, which produces popular console and PC games such as the Call of Duty franchise and World of Warcraft.1
  • Though an earlier investigation found that the purchase could damage competition in the cloud gaming sector, the European Commission accepted Microsoft's compromise to offer 10-year free licenses to consumers to stream Activision games on competing cloud services.2
  • The approval comes as Microsoft has struck deals with Nvidia, Nintendo, Boosteroid, and Ubitus to bring Call of Duty to their gaming platforms pending official completion.3
  • Britain's Competition and Markets Authority (CMA), however, vetoed the deal, citing antitrust concerns over the cloud gaming market less than a month ago. The US Federal Trade Commission is also suing to nix it.4
  • Regulators in Brazil, Chile, Japan, Saudi Arabia, Serbia, and South Africa have already approved the acquisition, with Australia, China, New Zealand, and South Korea still reviewing the deal.5
  • If the deal goes ahead, the giant tech company will become the world's third-largest game publisher after Tencent and Sony.6

Sources: 1CNBC, 2Guardian, 3Al Jazeera, 4Reuters, 5Verge, and 6CNN.

Narratives

  • Narrative A, as provided by VGC. UK and US regulators are correct in their analysis that Microsoft’s acquisition of Activision is anti-competitive, and approval of the deal would provide the tech giant with control of the growing cloud gaming industry. While Microsoft has agreed to license its games to alternative platforms, it would have authority over all terms and conditions. This would undermine a genuine free market by providing one of the world’s largest tech companies with a monopoly in this lucrative industry.
  • Narrative B, as provided by Kotaku. Not only is Microsoft not a detriment to competition in the gaming market, but its acquisition of Activision will actually drive competition and allow users to stream their favorite games on any platform they choose. While some concessions needed to be made, this agreement will empower users around the world to control their gaming experience and allow innovation in the rapidly growing cloud gaming sphere. The CMA is wrong in its decision to block Microsoft’s deal, and it should approve the company’s appeal.

Predictions