The European Commission clears Microsoft’s acquisition of Activision Blizzard. The announcement was followed by a statement from the UK regulator and regulator, the CMA, which continues to block the deal.
The European Commission does not want to oppose the planned acquisition of Activision Blizzard by Microsoft. As the competition authorities announced on Monday afternoon, the deal approved with conditions.
A few weeks earlier, the decision by the British Competition & Markets Authority (CMA) caused a stir. In the UK, the Takeover blocked and it remains to be seen whether Microsoft’s and Activision Blizzard’s efforts to change the mind of the competition authorities will bear fruit.
In fact, it looks like the CMA will stand firm. Accordingly, the British authority was disappointed with today’s announcement by the European Commission.
Competitive market at risk
In response to the EU decision explained the CMAthat the EU Commission wrongly approved the deal.
“UK, US and European competition authorities agree that this merger would harm competition in cloud gaming. The CMA concluded that to foster innovation and choice in this rapidly evolving sector, cloud gaming must persist as a free, competitive market.”
According to the CMA, Microsoft’s proposals, accepted by the European Commission, would give the company the ability to set the terms of this market for the next ten years. “They would replace a free, open and competitive market with one that is subject to constant regulation of the games Microsoft sells, the platforms on which they are offered and the terms of sale,” the assessment said.
The CMA continued: “This is one of the reasons why the CMA’s independent panel rejected Microsoft’s proposals and prevented this deal. While we recognize and respect that the European Commission has the right to have a different opinion, the CMA stands by its decision.”
The American Federal Trade Commission (FTC), which is even suing against the planned takeover of Activision Blizzard by Microsoft, sees it similarly to the CMA.
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Whether the takeover of Activision Blizzard by Microsoft will ultimately come about is still open. Success largely depends on whether the regulatory authorities in the US and UK can be persuaded with remedial measures.
Investors, at least, remain skeptical. The European Commission’s announcement did not have a significant impact on Activision Blizzard’s share price.
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