Microsoft Activision Blizzard deal approved by EU regulators as CMA respond

15 May 2023 , 15:14

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The European Commission has approved the Microsoft buyout of Activision Blizzard while the CMA "stands by its decision" (Image: Billy Freeman on Unsplash)

Microsofts proposed buyout of Activision Blizzard has been approved by EU regulators, weeks after the UK's CMA rejected the bid.

Mere weeks after the CMA rejected the Microsoft Activision deal, the European Commission has announced that it has approved Microsoft's proposed $68.7 billion buyout of the Activision Blizzard, via a statement on its website, as the tech giant's CMA appeal looms. The EU Commission's findings state that "even if Microsoft did decide to withdraw Activision’s games from the PlayStation, this would not significantly harm competition in the consoles market" even though they found that Microsoft "would have no incentive to refuse to distribute Activision's games to Sony".

Despite the approval of the deal, the EU shared concerns held by the CMA that the deal "could harm competition in the distribution of games via cloud game streaming services". However, the report also went on to say "Despite its potential, cloud game streaming is very limited today. The Commission found that the popularity of Activision's games could promote its growth" treating the CMA's cloud gaming angle as a double-edged sword.

However, the EU proposed remedies including "free license to cloud game streaming service providers to allow EEA-based gamers to stream any Activision Blizzard's PC and console games." While noting that some cloud gaming providers have "already entered into bilateral agreements with Microsoft based on the proposed licenses to stream Activision's games, once the transaction is completed".

The CMA responds

In response to the EU regulator's findings, the CMA has issued a statement, declaring that they stand by their original decision. “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," stated the CMA.

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"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.

“While we recognise and respect that the European Commission is entitled to take a different view, the CMA stands by its decision". While this deal is a big win for Microsoft, they'll still need to convince the CMA who – based on its statements – is ready and willing to stand it's ground in opposition of the deal, so we expect the deal to go on for a while longer before it finally goes through or is killed.

Scott McCrae