In the European Union, the regulator approved Microsoft’s corporation takeover of Activision Blizzard Inc.
Source: Pixabay.com
The value of this transaction is $69 billion. The decision of the European regulatory authority is radically opposite to the attitude of the British and American authorities to the takeover. The European Commission reported that the results of its own analysis of the potential consequences of the implementation of the transaction indicate that in this case the lawful competition process will not be violated. Microsoft has promised to allow cloud competitors to offer blockbusters such as Call of Duty on its platforms for the next ten years.
The approval of the European regulatory authority is not a guarantee that the takeover will eventually take place. Microsoft will have to win legal proceedings in the United States and the United Kingdom. The probability that the technology giant will successfully cope with this task is not the maximum.
The head of the EU antimonopoly authority, Margrethe Vestager, said last Monday, May 15, that this deal promotes competition and stimulates the development of the cloud streaming services market, whose share in the gaming market currently is no more than 3%.
The UK Competition and Markets Authority decided in April not to approve the takeover process. According to some experts, this is a demonstration of becoming a global observer after Brexit. The US Federal Trade Commission also does not believe that this deal should be implemented, as evidenced by its actions to block the business agreement in 2022.
Vestager says that the different positions of the EU and the UK on the issue of the legal and economic attitude to the deal are related to the assessment of the prospects for the future development of the cloud gaming market. She noted that from the perspective of prospects, the cloud data streaming market is promising, but there is no consensus on the speed of its scaling processes.
Analyst Jennifer Rea says that the EU decision gives some hope for the success of the deal, which is facing active resistance, but it will not have an impact on the results of court proceedings in the US and the UK.
The European Commission notes that the commitment to allow millions of European consumers to stream Activision games using any cloud gaming services is sufficient grounds for approval.
Bobby Kotick, chief executive Officer of Activision, said that the European Commission conducted a thorough and deliberate study of the game world and its features. He also noted that the regulator demanded tough measures to ensure reliable competition in the fast-growing industry.
The CMA believes that the takeover process will provide Microsoft with a special position in the cloud gaming market and provide control over other products, including Overwatch and World of Warcraft. The British supervisory authority says that without a deal, Activision will be able to provide games on cloud platforms.
Sarah Cardell, head of the CMA, believes that the approval of the takeover gives Microsoft the opportunity to set the rules and dictate conditions in the market for 10 years. She noted that the European Commission has the right to a different point of view on this issue, but the British regulator will remain of its opinion.
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