The UK’s CMA rejected Microsoft acquisition of Activision Blizzard last month after an extensive investigation. The authority voiced concerns that the acquisition could give Microsoft an unfair advantage in the rapidly growing cloud gaming market by making Activision’s games exclusive to its service.
Today, the European Commission approved Microsoft’s proposed acquisition of Activision Blizzard with condition on full compliance with the commitments offered by Microsoft. The EC believes that the commitments offered by Microsoft will enable for the first time the streaming of such games in any cloud game streaming services, enhancing competition and opportunities for growth.
Today, the Competition & Markets Authority of the UK responded to the European Commission’s approval for the deal with the following statement.
- The UK, US and European competition authorities are unanimous that this merger would harm competition in cloud gaming. The CMA concluded that cloud gaming needs to continue as a free, competitive market to drive innovation and choice in this rapidly evolving sector.
- Microsoft’s proposals, accepted by the European Commission today, would allow Microsoft to set the terms and conditions for this market for the next 10 years.
- They would replace a free, open and competitive market with one subject to ongoing regulation of the games Microsoft sells, the platforms to which it sells them, and the conditions of sale. This is one of the reasons the CMA’s independent panel group rejected Microsoft’s proposals and prevented this deal. While we recognise and respect that the European Commission is entitled to take a different view, the CMA stands by its decision.
Meanwhile, Activision Blizzard CEO Bobby Kotick sent an email to his employees that this approval from EC is a crucial step for the deal.
This important step provides a proper roadmap for regulators around the world to consider when determining how best to encourage and promote competition in the gaming industry.
There is still work to be accomplished before our merger can be finalized but it is encouraging that regulators like the European Commission understand and appreciate the considerable growth opportunities provided by our industry.