The last few weeks haven’t been great for Microsoft but things might be changing as the European Commission has announced it has approved the company’s $68.7 Billion acquisition of Activision Blizzard, according to GameIndustry.Biz. The approval follows weeks after the UK’s regulator, the Competition and Markets Authority (CMA) blocked the deal.
The European Commission initially had concerns about the deal’s negative impacts on the PC, console, and subscription markets but after giving a better look at them through a deep-dive investigation, the regulator determined that there wasn’t any real issue. As for the distribution of Activision Blizzard games on the cloud gaming market, this is where concerns came up for the commission but instead of outright denying the deal, in order to push the deal through Microsoft has agreed to a few commitments that the company must meet in a 10 year period.
The first commitment is to offer a free license to consumers in European Economic Area (EEA) allowing them to stream Activision Blizzard titles on their cloud streaming service of choice. The titles applicable will be all current and future PC and console Activision Blizzard titles. Secondly, to allow EEA gamers to stream these titles Microsoft must offer a corresponding free license to cloud game streaming service providers. In order for Microsft to meet these commitments, an independent trustee will be monitoring to make sure these proposed commitments are met.
“These licenses will ensure that gamers that have purchased one or more Activision games on a PC or console store, or that have subscribed to a multi-game subscription service that includes Activision games, have the right to stream those games with any cloud game streaming service of their choice and play them on any device using any operating system. The commitments fully address the competition concerns identified by the Commission and represent a significant improvement for cloud gaming as compared to the current situation,” the European Commission said in a statement.
The European Commission has required Microsoft to license popular Activision Blizzard games automatically to competing cloud gaming services. This will apply globally and will empower millions of consumers worldwide to play these games on any device they choose.
— Brad Smith (@BradSmi) May 15, 2023
Both entities agreed that it wouldn’t make great business sense to hold back releasing Microsoft-owned Activision Blizzard titles from PlayStation’s platform in the region. Especially, seeing how players favour their console of choices in the territory as European gamers have more of an affinity to PlayStation compared to Xbox consoles with a ratio of four to one in the region; so makes sense to not keep Activision Blizzard games exclusive to Xbox.
This news marks the biggest region to approve of the acquisition alongside other prominent countries including Saudi Arabia, Brazil, Serbia, Chile, Japan, South Africa and Ukraine. As for where it goes from here the FTC in the US has already filed a suit to stop the acquisition and as previously stated that CMA has blocked the deal in the UK, even vowing to stop the acquisition from happening globally. In response to the Europe Commission’s approval of the acquisition, the CMA has released a statement.
“The UK, US and European competition authorities are unanimous that this merger would harm competition in cloud gaming. The CMA concluded that cloud gaming needs to continue as a free, competitive market to drive innovation and choice in this rapidly evolving sector. While we recognize and respect that the European Commission is entitled to take a different view, the CMA stands by its decision,” the Competition and Markets Authority said in a statement.
“Microsoft’s proposals, accepted by the European Commission today, would allow Microsoft to set the terms and conditions for this market for the next ten years. They would replace a free, open and competitive market with one subject to ongoing regulation of the games Microsoft sells, the platforms to which it sells them, and the conditions of sale. This is one of the reasons the CMA’s independent panel group rejected Microsoft’s proposals and prevented this deal.”