Microsoft's $69B Activision deal gets European pushback
Microsoft's proposed $69 billion acquisition of Activision Blizzard is getting stiff pushback overseas amid fears that it would have too much power and harm competition in the video game industry.
Why it matters: The European Union's competition commission said it would conduct an in-depth review of the merger that could take as long as 90 working days.
- "[T]he Commission is concerned that, by acquiring Activision Blizzard, Microsoft may foreclose access to Activision Blizzard's console and PC video games, especially to high-profile and highly successful games," the EU said in a statement.
The big picture: The EU's move comes a month after the U.K. opened its own deeper probe into the deal.
- A rep for Microsoft told Axios that the company still expects to close the deal during its fiscal 2023.
- "We're continuing to work with the European Commission on next steps and to address any valid marketplace concerns. Sony, as the industry leader, says it is worried about Call of Duty, but we've said we are committed to making the same game available on the same day on both Xbox and PlayStation. We want people to have more access to games, not less," the company said.
The intrigue: Intense scrutiny from two of the largest international regulatory bodies could signal that the FTC feels the same way.
- Unlike past mega-mergers, the FTC (along with the DOJ's antitrust division) will no longer approve big mergers with conditions. It's either all or nothing.
💭 Thought bubble: Axios Gaming's Stephen Totilo says the best news about the EU's expected decision is that its arguments closely resemble those of U.K. regulators. Its lawyers and lobbyists can essentially write the same counter-argument.
- For the EU and the U.K., the concern isn't about Microsoft getting control or World of Warcraft or Candy Crush; it's all about the power of owning Call of Duty (CoD).
- Microsoft keeps swearing it won't yank CoD from rival platforms, but the biggest problem it faces is downplaying the market advantages it will have even if it kept the popular shooter series multi-platform: making its own platforms the cheapest place to play it and seeing its rivals suffer the results.