(Brussels) The European Commission on Monday approved the acquisition of the American video game publisher Activision Blizzard by Microsoft for 69 billion dollars, three weeks after a British veto which jeopardizes the operation.
The future of this giant merger remains totally uncertain. Not only does the positive opinion from Brussels contradict the rejection pronounced at the end of April by the British competition authority (CMA), but in addition the American authority (FTC) launched proceedings in December to block this takeover.
The green light from Brussels is conditional on Microsoft’s compliance with measures proposed by the American giant to guarantee competition in the market for dematerialized games accessible by streaming. These commitments “fully address the issues raised by the Commission,” the EU executive said in a statement.
In a video game sector in full consolidation, Microsoft, which markets the Xbox console, announced in January 2022 the acquisition of Activision Blizzard, publisher of successes such as call of duty, World of Warcraft And candy Crushfor 69 billion dollars, a record amount in this sector.
The merger, if completed, will give birth to the third player in the sector in terms of turnover, behind Chinese Tencent and Japanese Sony, maker of the PlayStation.
The European Commission, guardian of competition in the EU, opened an in-depth investigation into this operation in November. The procedure will have finally made it possible to allay his fears.
But, for the first time since Brexit in an issue of such magnitude, Brussels and London have adopted divergent positions.
The British competition authority announced on April 26 its decision to block the mega-merger, judging the risks too high for competition.
Microsoft had immediately announced that it would appeal. “This decision appears to reflect a misunderstanding of this market and how cloud technology really works,” the group said at the time.
The green light from Brussels should provide him with solid arguments to challenge the CMA’s decision before the Competition Appeal Tribunal (CAT) in the United Kingdom.
Free licenses
“If Microsoft does not win the appeal before the CAT, it will not be able to proceed with the acquisition even if the European Commission approves it”, estimates Anne Witt, specialist in competition law at EDHEC (France).
“Unless, of course, Microsoft decides to exit the UK market, but that seems unlikely,” she told AFP.
Like its counterpart in the United Kingdom, the European regulator rules out any risk for competition in the game console market, while Sony was worried about being denied access to Activision Blizzard’s great successes.
“Microsoft would have no interest in refusing to distribute Activision games to Sony, which is the world’s largest distributor of console games,” the Commission ruled, pointing out that Sony PlayStations sell four times more than from Microsoft’s Xbox.
“Sony could take advantage of its size, its extensive catalog of games and its position in the market to counter any attempt to weaken its competitive position”, explains the European executive.
The Commission was concerned, like the CMA, for the booming market of dematerialized games accessible in streaming which allow to play indifferently on tablet, smartphone or computer…
But she accepted the solutions proposed by Microsoft.
“For a period of 10 years”, the American giant will grant European consumers free licenses “for all current and future Activision Blizzard games” legally acquired, allowing them to play on any device, regardless of operating system . A corresponding free license will also be granted to competing streaming game services.
“This measure will apply globally and will allow millions of consumers around the world to play these games on the device of their choice”, welcomed Brad Smith, the president of Microsoft, quoted in a statement.
“We intend to significantly grow our investments and our teams in the EU, and we look forward to seeing the benefits this transaction will bring to players in Europe and around the world,” said Bobby Kotick. , the boss of Activision Blizzard.