Activision Blizzard acquisition by Microsoft has been approved by EU regulators. The deal (worth $68.7 billion) passed with commitments from Microsoft related to cloud gaming. EU regulators found that Microsoft wouldn’t refuse to distribute Activision’s games to Sony, and even if they did, it wouldn’t harm competition significantly in the console market. However, concerns were raised about competition in PC and console game distribution through cloud gaming services.
To address these concerns, the European Commission has identified remedies through 10-year licensing deals offered by Microsoft. Consumers in EU countries will receive a free license to stream all current and future Activision Blizzard games on any cloud game streaming service. Cloud providers in EU markets will also receive free licenses to stream these games.
These licenses grant consumers the right to stream Activision Blizzard games they’ve purchased on any cloud game streaming service, device, and operating system. The European Commission requested Microsoft to offer this automatic license, which will be implemented globally.
Margrethe Vestager, executive VP at the European Commission, sees this decision as an important step, bringing Activision’s games to more devices and enhancing competition.
The EU’s approval comes after UK regulators blocked Microsoft’s plans due to concerns about the cloud gaming market. Microsoft is appealing the decision. The company has been addressing regulators’ concerns through cloud gaming deals with various companies. The UK’s Competition and Markets Authority (CMA) fears Microsoft’s control over popular games like Call of Duty could harm competition in the cloud gaming market.
Microsoft’s appeal process with the CMA will likely take months. The EU’s decision may boost Microsoft’s chances, but battles remain in the US and UK. Regulators in other countries have approved the deal, while some are still reviewing it.
The next hurdle for Microsoft is regulatory scrutiny from the Federal Trade Commission, with an evidentiary hearing scheduled for August 2nd.
Activision Blizzard CEO Bobby Kotick welcomes the EU approval and aims to expand investment in the EU. However, the CMA defends its position, stating that the merger would harm competition in cloud gaming.
Microsoft faces a tough appeal battle with the CMA, even with concessions made to the EU.