Microsoft’s $69 billion acquisition of Activision is expected to receive EU antitrust approval, as the tech giant offers licensing deals to rivals to ease concerns.
The acquisition, announced in January 2022, is Microsoft’s biggest ever and will enable the company to compete with Tencent and Sony in the booming video gaming market and venture into the metaverse, or virtual online worlds for work, play, and socializing.
The European Commission is scheduled to decide on the deal by April 25, and sources say it is unlikely to require Microsoft to sell assets to secure approval.
What might the Commission require?
Microsoft may have to offer other behavioral remedies to alleviate the concerns of parties other than Sony. Microsoft President Brad Smith said the company was willing to offer rivals licensing deals to address antitrust concerns but would not sell Activision’s lucrative “Call of Duty” franchise.
The EU competition enforcer declined to comment, but Microsoft said it was committed to providing effective and enforceable solutions to address the European Commission’s concerns.
The company’s spokesperson said, “Our commitment to grant long-term 100% equal access to Call of Duty to Sony, Steam, NVIDIA, and others preserves the deal’s benefits to gamers and developers and increases competition in the market.”
Microsoft’s minimum-effort concessions
Microsoft signed 10-year licensing deals with Nintendo and Nvidia last month that would bring Call of Duty to their gaming platforms, conditional on the approval of the Activision deal.
However, the deal faces regulatory challenges in the UK, where the competition agency suggested Microsoft divest Call of Duty to address its concerns, while the US Federal Trade Commission (FTC) asked a judge to block the deal.
Activision’s shares rose 1.8% in pre-market trading after Reuters’ story was published and were up 2.6% in late trade. With the EU’s approval likely, the acquisition will significantly bolster Microsoft’s gaming presence and increase competition in the market.
5 hours ago
