Microsoft’s deal with Activision Blizzard is now facing an “in-depth” investigation by the EU

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The European Commission announced this after its first investigation into Microsoft’s proposal Acquisition of Activision Blizzard in a value of 69 billion US dollarsit will now launch a “deeper” Phase 2 investigation to determine the likely competitive impact of the deal.

In an opinion on his websiteThe European Commission said it made the decision after its preliminary investigation showed that the acquisition of Microsoft would “enhance competition in the markets for console and PC video game distribution, including multi-game subscription services and/or cloud.” game streaming services, and for PC operating systems”.

It specifically drew attention to its concerns that Microsoft had a “potential economic incentive” to prevent competitors from accessing Activision Blizzard’s “high-quality and hugely successful games” after the deal closes, notably citing the Call of Duty Line it up – something Microsoft has repeatedly insisted on it won’t do.

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The European Commission also raised concerns that the same “high-profile and hugely successful games” could be made exclusive to Microsoft’s multi-game and cloud-streaming services to the detriment of similar competing services, and that the deal could also potentially be used to deter users from them discourage people from buying non-Windows PCs.

“Such foreclosure strategies could reduce competition in the markets for console and PC video game distribution,” she wrote, “and result in higher prices, lower quality and less innovation for console game retailers, which in turn are passed on to consumers.” could. ”

As a result of its preliminary findings, the European Commission will now launch an in-depth investigation to determine whether its initial competition concerns are confirmed. This second phase will last 90 working days, with the deadline for a decision now set for March 23 next year.

The European Commission’s announcement follows a similar move by the UK’s Competition and Markets Authority (CMA), which has launched its own “Phase 2” investigation into the Microsoft acquisition in Septemberafter it was determined that the deal “[give] Rising to a realistic prospect of significantly reducing competition in gaming consoles, multi-game subscription services and cloud gaming services.”

The CMA’s investigation – which is currently ongoing seek public opinion on this matter – has a statutory deadline of March 1st next year. Several countries – including Brazil’s Economic Defense Council (CADE) – have already done so agreed to the deal.

CEO Bobby Kotick announced in an open letter posted on Activision Blizzard’s investor website in recognition of the European Commission’s expanded investigation wrote“We have worked closely with Microsoft to actively engage regulators in other key countries to answer their questions and provide them with information to assist in their review. People from all of our businesses and functions have been involved in this regulatory work, and I want to thank each of you for your tireless work and dedication to completing this merger, which we continue to expect to see in Microsoft’s current fiscal year, which begins in… June 2023 ends.”

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