The CMA (Competition and Markets Authority) recently opened an antitrust investigation into the proposed acquisition of Microsoft, for 68.7 billion dollars, concerning the American publisher Activision Blizzard.
The UK Competition and Markets Authority says it is studying whether the merger between Microsoft and Activision Blizzard could lead to a substantial lessening of competition in one or more markets for goods or services in the UK. It has set September 1 as the deadline to decide whether to submit the proposed merger to a phase 2 investigation, which could allow the parties to discuss and possibly agree on remedies for any identified competitive harm.
🔍 We’ll consider if gamers could end up paying higher prices, with less choice or lower quality.
— Competition & Markets Authority (@CMAgovUK) July 6, 2022
“We expect and believe it is appropriate for regulators to closely scrutinize this acquisitionMicrosoft vice president and general counsel Lisa Tanzi said in a statement. “We’ve been clear about how we plan to run our games business and why we believe the deal will benefit gamers, developers and the industry. We are committed to answering questions from regulators and we sincerely believe that a thorough review will allow the transaction to be completed with broad confidence, and that it will be positive for competition. We remain confident that the transaction will close in fiscal 2023, as originally anticipated.”
Nothing is won for Microsoft in the acquisition of Activision Blizzard
With Lina Khan and the FTC on their backs, Microsoft has embarked on a global charm offensive to stave off regulatory concerns. Last February, the company announced several commitments that will apply to its games business to allay any concerns that its position as gatekeeper would give it anti-competitive power over game publishers or software developers, a allegation that has plagued Apple and Google around the world.
Last month, Activision Blizzard flip-flopped that it was ready to negotiate with unions, after Microsoft said it would be more receptive to them. Prior to Microsoft’s deal announcement, Activision Blizzard was embroiled in a scandal in which the company was accused of allowing a pervasive “frat boy” corporate culture to thrive that allegedly resulted in female employees were constantly sexually harassed and paid less than men.