EU Approves Microsoft’s Acquisition of Activision Despite UK Veto

Microsoft has received antitrust approval from the European Union (EU) for its $69 billion acquisition of Activision, marking a significant development that may influence Chinese and Korean regulators despite facing a veto from the UK. The deal, considered the largest in gaming history, is still under scrutiny, with Microsoft having until May 24 to appeal the decision by the UK Competition and Markets Authority (CMA), which has blocked the acquisition. The final decision may take months, and the United States Federal Trade Commission’s case against the deal is also pending.

The European Commission, however, has deemed the deal pro-competitive, emphasizing Microsoft’s licensing deals. Margrethe Vestager, the EU antitrust chief, stated that these licenses are practical and effective, significantly improving conditions for cloud game streaming. Microsoft has offered 10-year free licensing deals to European consumers and cloud game streaming services for Activision’s PC and console games. The EU watchdog highlighted that Microsoft’s licensing agreements with various entities, including Nvidia, Nintendo, Ukraine’s Boosteroid, and Japan’s Ubitus, contribute to the pro-competitive nature of the deal.

Microsoft President Brad Smith noted that the European Commission has mandated Microsoft to license popular Activision Blizzard games to competing cloud gaming services globally, empowering millions of consumers to play these games on any device of their choice. Vestager highlighted differences in the assessment of the cloud gaming market’s growth between the EU and the UK, stating that the remedies taken by the EU would facilitate licensing to a broader audience in the cloud gaming markets.

While the UK’s CMA maintains its veto, Microsoft plans to appeal to the Competition Appeal Tribunal, expecting a decision in the coming months. Another significant hurdle lies with the US Federal Trade Commission, which aims to block the deal, while Japan approved the takeover in March. The final outcome of this high-profile acquisition will unfold through further legal proceedings and regulatory considerations.

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