Like the Competition and Markets Authority (CMA) in the United Kingdom, the European Commission believes that the acquisition of the American publisher Activision Blizzard by Microsoft will not be healthy for competition in the video game industry and the evolution of the games market. long term video.
Already in the sights of the competition authorities in the USA and the United Kingdom, Microsoft will also have to convince the European Commission to validate the acquisition ofActivision Blizzard which should normally be formalized before the end of June 2023. A preliminary investigation reports that the estimated $68.7 billion deal may significantly reduce competition in the distribution market for video games for consoles and PCs, including video game subscription and/or cloud game streaming services, and in the PC operating system market.
#MergerControl Commission ???????? opens in-depth investigation into the proposed acquisition of Activision Blizzard by Microsoft ????????https://t.co/qttzWXTKPa pic.twitter.com/QWDCag28mM
— EU Competition (@EU_Competition) November 8, 2022
Margrethe Vestager, Executive Vice President for Competition Policy at the European Commission, said:
Video games attract thousands of users around the world and are among the fastest growing forms of digital entertainment. Microsoft has been a major player in the game marketing chain for years. Today it acquires Activision Blizzard, a wildly successful game content publisher. We must ensure that this transaction does not drive out existing and future console and PC video game distributors or competing PC operating system vendors from the market. The goal is to ensure that the gaming ecosystem retains its tremendous vitality, for the benefit of users, in a rapidly changing industry. The in-depth investigation will allow us to assess how the deal affects the game’s marketing chain.
Unfair competition pointed out by the European Commission
By letting Microsoft own Activision Blizzardone of the five GAFAM members could freely:
- Lock access to video games for consoles and PC from Activision Blizzard, including iconic and hugely successful games such as Call of Dutywhose latest installment achieved a record start while grossing $1 billion in ten days, driven primarily by its PlayStation console sales
- Having the ability, as well as the economic temptation, to implement predatory strategies against competing console video game distributors, for example by preventing them from distributing Activision Blizzard’s console video games on consoles or by degrading the conditions of access to or use of these video games
- Lock access to its own PC and console video games on video game subscription and/or cloud game streaming services in particular, knowing that they are essential for the provision of these nascent services, at the detriment of competing console and PC video game distributors that offer such services
- Reduce competition in the console and PC video game distribution markets, leading to higher prices, lower quality and reduced innovation for console game distributors, who may then pass on to consumers
- Reduce the ability of other PC operating system vendors to compete with Windows, its operating system, by combining Activision Blizzard’s games and its game distribution via cloud game streaming to Windows, in order to discourage users from buying non-Windows PCs
- Have the ability, as well as the economic temptation, to implement such a strategy against competing PC operating system vendors
The European Commission has given itself until March 23, 2023 to give a final verdict on the takeover of Activision Blizzard by Microsoft.