After being blocked by the UK, the European Union has approved the $68.7bn mega merger between Microsoft (and game developer Activison Blizzard) and Activison Blizzard.
Microsoft has been assured by European regulators that it will not reduce competition if they take over Call Of Duty developer.
Microsoft announced that it would appeal the ruling in April. The UK regulator was concerned with the stifling of competition within the gaming industry.
Video games are played by billions of people around the globe. Margrethe Vestager, EU Competition Commissioner said that in a dynamic and fast-growing industry it’s important to protect innovation and competition.
Our decision is an important step forward in this direction. Cloud game streaming will bring Activision’s most popular games to a much wider range of devices and consumers.
Microsoft’s commitments will allow for the first-time the streaming of these games on any cloud gaming streaming service, increasing competition and growth opportunities.
Xbox is one of the largest tech companies in the world. It accounts for 70% of cloud gaming, which allows people to play games online without having to download them.
Activision Blizzard’s CEO Bobby Kotick responded: “The EC undertook a deliberate, thorough process to gain a complete understanding of gaming.
“They approved our merger with Microsoft even though they demanded stringent remedies in order to ensure robust competitiveness in our rapidly expanding industry.”
We are excited about the benefits that our transaction will bring to players around the globe and in Europe.
Microsoft President Brad Smith stated: “The European Commission required Microsoft to automatically license popular Activision Blizzard titles to competing cloud gaming service providers.
This will be available globally, allowing millions of users to enjoy these games on their preferred devices.
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The UK regulator is standing by its decision
Sarah Cardell is the chief executive officer of UK Competition and Markets Authority. She said: “The UK and European competition authorities agree that this merger will harm competition in cloud games. The CMA concluded cloud gaming must continue to be a competitive, free market in order to promote innovation and choice within this rapidly changing sector.
Microsoft’s proposals accepted today by the European Commission would allow Microsoft the right to determine the terms and conditions of this market for the following ten years.
They would replace a market that is free, competitive, and open with one that requires ongoing regulation over the games Microsoft sells and the platforms on which it does so. Also, they would regulate the terms of sale. The CMA’s independent group of panelists rejected Microsoft’s proposal and prevented the deal.
The CMA is standing by its decision, even though we acknowledge and respect the right of the European Commission to have a different opinion.
The CMA’s rejection of the application means that the company will have to apply for approval to operate in the UK, even though it has received EU approval.