After the CMA’s recent decision to block Microsoft’s $68.7 billion Activision Blizzard merger, the company was hoping for a more favorable outcome from the European regulator.
The European Commission has now announced its final decision, approving the Activision Blizzard acquisition.
Why it matters: Microsoft first announced the acquisition in January 2022. Over a year later, the company has not made much progress toward this goal, but this approval will be a huge step forward for Microsoft.
#EUMergerControl Commission 🇪🇺 clears acquisition of Activision Blizzard 🎮by Microsoft, subject to conditions 👇
🔗➡️https://t.co/qG3D0jNfPo pic.twitter.com/Q3P2miYisH
— EU Competition (@EU_Competition) May 15, 2023
The CMA blocked this deal over concerns of Microsoft becoming too strong in the cloud gaming space. However, the European Commission believes cloud gaming is too limited today but still agrees with the possibility of Microsoft becoming dominant in the segment after the deal.
Microsoft previously offered remedies to address this concern, including various decade-long deals with cloud services like Boosteroid, Nvidia GeForce Now, and more. Recent remedies include a free license for cloud streaming providers and more.
In other areas, the regulator does not see too many problems after the deal in the console gaming space. According to the European Commission, even if Activision IPs became exclusive at some point, it would not eliminate competition.
With the European Commission’s approval, Microsoft is one step closer to acquiring Activision Blizzard. The gaming giant will appeal the CMA’s decision, and the FTC’s final verdict could be key to the fate of this deal.
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