EU backs Microsoft's $69 billion acquisition of Activsion Blizzard

The European Union has backed Microsoft's $69 billion acquisition of Call of Duty maker Activision Blizzard.

Only a few weeks after the UK's Competition and Markets Authority (CMA) vetoed the deal, the EU regulators have backed Microsoft's $69 billion acquisition of Activision Blizzard. The European Commission raised a number of issues with the acquisition, but accepted Microsoft's pledges since, in its opinion, they effectively handled matters including cloud gaming. 

               According to the EU, Microsoft "would have no incentive to refuse to distribute Activision's games to Sony" and "even if Microsoft did decide to withdraw Activision's games from the PlayStation, this would not significantly harm competition in the consoles market." However, EU regulators, like those in the UK, concluded that the acquisition might hurt competition in the market for PC and console game distribution via cloud gaming services.  

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Microsoft's 10-year licencing agreements with rivals have been recognized by the European Commission as potential remedies to allow the merger to proceed. In addition, all existing and upcoming Activision Blizzard PC and console games that consumers in EU nations hold a licence for will be available to stream for free via "any cloud game streaming services of their choice." A free licence to stream these games in EU markets will also be given to cloud service providers.  

It has been less than a month after UK regulators rejected Microsoft's proposals, and now the EU has decided to allow this massive transaction. The purchase was halted by the UK's Competition and Markets Authority (CMA) due to worries about the cloud gaming sector, which could result in "reduced innovation and less choice for UK gamers over the years to come." The ruling has been challenged by Microsoft.  

Microsoft has been addressing regulators' worries about cloud gaming for the past few months, with some success in the EU but not in the UK thanks to the deals. For Xbox PC titles to function on these competing cloud gaming platforms, the Xbox owner secured agreements with Nvidia, Boosteroid, and Ubitus. In December, a comparable agreement was made with Nintendo. If the agreement is accepted by authorities, all of these 10-year contracts also include access to Call of Duty and other Activision Blizzard titles.