Microsoft’s proposed $68.7 billion acquisition of Activision Blizzard is now approaching its final stages, with the recent approval of the deal by the EU Commission. While the UK’s Competition and Markets Authority (CMA) intends to block the acquisition, the EU regulator was persuaded by the remedies Microsoft presented, despite sharing similar concerns about the nascent cloud gaming market.
To address these concerns, Microsoft has made several commitments with a 10-year duration, as follows:
- A free license for consumers in the EEA to stream all current and future Activision Blizzard PC and console games via their preferred cloud game streaming services.
- A corresponding free license for cloud game streaming service providers to enable EEA-based gamers to stream any Activision Blizzard PC and console games
- The EU believes that these commitments “fully address” the concerns and significantly improve the state of cloud game streaming compared to the current situation. Brad Smith, Microsoft’s Vice Chair and President, has now provided additional details regarding these promises. He stated, “The European Commission has mandated Microsoft to automatically license popular Activision Blizzard games to competing cloud gaming services, allowing millions of consumers worldwide to play these games on any device of their choosing.”
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
One interesting aspect worth noting is that Microsoft has opted to make this commitment global, even though the EU’s concerns are specifically related to the European Economic Area.
While the CMA defended its decision to block the deal in front of UK MPs, emphasizing its stance against anti-competitive mergers, the decision is currently under appeal. This process could potentially result in the deal being re-evaluated by the CMA. In the United States, the Federal Trade Commission is also taking legal action to block the acquisition, indicating that the matter is far from resolved.
Microsoft hopes that its comprehensive license offering will alleviate some of the doubts surrounding the acquisition. However, it’s worth noting that the commitment’s relatively short duration is concerning. In the context of the rapidly evolving cloud gaming market, ten years is a relatively brief period, and it leaves room for Microsoft to potentially withdraw from these commitments in the near future. Microsoft has earned its position as one of the world’s largest tech companies not solely by playing nice but by demonstrating its strength and influence, despite presenting an amiable front before regulators.