EU Launches Comprehensive Probe into Microsoft's Acquisition of Activision Blizzard

The European Commission has announced the findings of its preliminary inquiry into Microsoft's proposed acquisition of Activision Blizzard, stating that the results warrant a thorough investigation into the deal's potential impact on competition. The Commission's initial investigation reveals that the acquisition may substantially lessen competition in the console and PC video game distribution markets, including subscription services and cloud gaming platforms, as well as the market for PC operating systems. Specifically, the Commission is worried that Microsoft's acquisition of Activision Blizzard could limit access to the publisher's console and PC games, particularly popular titles like Call of Duty, on rival gaming platforms. The Commission is also concerned that Microsoft might restrict Activision Blizzard games on competing consoles or degrade the terms of their use, thereby undermining competition in the subscription and cloud gaming markets. Furthermore, the deal could reinforce Microsoft's dominance in the PC operating system market by making Activision Blizzard games exclusive to Windows. The European Commission has set a deadline of March 23 to complete its in-depth investigation and make a decision. In response to the decision, Activision Blizzard CEO Bobby Kotick addressed employees in a letter, stating that the regulatory approval process is progressing as anticipated and highlighting the approval received from Brazilian regulators. Kotick assured that the company will continue to cooperate with the European Commission and work closely with Microsoft to engage with regulators worldwide, providing them with the necessary information to facilitate their review. The regulatory approval process is ongoing, with the US Federal Trade Commission and the UK Competition and Markets Authority among the regulators yet to approve the deal.