EU approves Microsoft’s purchase of Activision

Microsoft Corp has received antitrust approval from the European Union for its $69 billion acquisition of Activision, a move that may influence regulators in China and Korea to follow suit. Despite the approval, Microsoft still faces challenges in completing the deal. The British Competition and Markets Authority (CMA) has blocked the acquisition, and Microsoft has until May 24 to appeal the decision. The final resolution of the case could take several months, and the United States Federal Trade Commission is also reviewing the deal.

The European Commission deemed the gaming industry’s largest-ever deal to be pro-competitive due to Microsoft’s licensing agreements. These agreements were considered practical and effective and were seen to enhance cloud game streaming conditions compared to the current situation. Microsoft has offered 10-year free licensing deals to European consumers and cloud game streaming services for Activision’s PC and console games, which the EU watchdog found to be favorable.

As part of the approval, Microsoft has committed to licensing popular Activision Blizzard games to competing cloud gaming services, enabling millions of consumers worldwide to play these games on any device. Brad Smith, President of Microsoft, expressed that these licensing agreements will benefit the gaming market globally. However, the UK Competition and Markets Authority stands by its veto of the deal, and Microsoft intends to appeal to the Competition Appeal Tribunal.

While Japan approved the acquisition in March, the US Federal Trade Commission remains a significant hurdle. Their decision to block the deal is pending, and it will be a crucial factor in the completion of the acquisition. The differing assessments of the cloud gaming market between the European Commission and the UK Competition and Markets Authority highlight the complexity and varying perspectives surrounding the deal.

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