Microsoft’s $68.7 Billion Acquisition of Activision Blizzard Stalled: The Latest Updates from the UK, EU and US

The UK said no, the European Union (EU) said yes, and the US is trying to oppose it again: Microsoft’s $68.7 billion acquisition of Activision Blizzard doesn’t seem still not near completion, a year and a half after being announced.

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The US competition authority, the FTC, asked a federal court in San Francisco on Monday to temporarily suspend the operation, according to the summary consulted by AFP.

The European Commission approved the transaction last month, which would make the computer giant the world’s third largest player in video games, while their British counterpart vetoed in the name of competition in the market for dematerialized games (cloud gaming). .

The FTC had already launched an administrative procedure to determine the risks associated with this acquisition, and a hearing is scheduled for early August, but press articles have circulated “suggesting that (Microsoft and Activision) were seriously considering completing the acquisition” despite this procedure and the prohibition of the CMA, the British authority, notes Monday’s summary.

“The proposed transaction would allow Microsoft to continue to take control of high-value video games,” argues the FTC.

“By controlling Activision’s content, Microsoft could, and would have an incentive to, withhold that content, or lower its quality in a way that weakens competition, including in terms of quality, price, and innovation,” says the federal agency.

“Better Compete”

Microsoft, which has marketed Xbox consoles for more than 20 years and owns many studios, assures that this acquisition would on the contrary bring more choice to the video game market.

The intervention of the FTC “should speed up the process”, reacted Brad Smith, the president of the firm of Redmond (north-west), on Twitter Monday.

“We always prefer constructive, amicable methods with governments, but we are confident and look forward to presenting our arguments,” he added.

Bobby Kotick, the general manager of Activision Blizzard, also said to “welcome positively” this rebound which will make it possible to “move things forward”, according to an email to employees published on the company’s website.

The publisher owns several phenomenal titles, played by tens of millions of people, from the shooter “Call of Duty” to the candy lines to explode on the famous “Candy Crush”, and “Overwatch” which has a championship of dedicated esport, the Overwatch League.

According to the boss, the merger would benefit hundreds of millions of players, American employees and shareholders (including people who depend on a pension fund for their retirement).

It “allows two American companies to better compete against international rivals that dominate the industry around the world,” he said.

Cloud gaming

Tencent and Sony reign in this market in Asia and beyond thanks in particular to Riot Games, the publisher of the planetary success “League of Legends”, for the Chinese giant, PlayStation consoles for the Japanese firm.

Sony had been concerned about being denied access to Activision Blizzard’s greatest hits. But according to the European Commission, “Microsoft would have no interest in refusing to distribute Activision games to Sony, which is the world’s leading distributor of console games”.

Regulators are especially concerned about the booming market for cloud gaming, dematerialized games accessible by streaming indifferently on tablet, smartphone or computer.

But the EU accepted the solutions proposed by Microsoft.

The American group plans to grant free licenses to consumers for current and future Activision Blizzard games allowing them to play on any device, regardless of operating system, for a period of 10 years.

With its request on Monday, the FTC hopes a judge will bar the two US companies from completing the takeover before the legal process is completed.

“If the transaction takes place, it will be the largest in the history of the video game industry and also in the history of Microsoft,” the FTC said.