Microsoft-Activision deal faces deeper EU probe
Despite repeatedly highlighting its plans to continue its games running on various platforms, even when it is announced that the $68.7 billion Activision merger is completed, Microsoft still failed to convince the European Union during its preliminary investigation.
The commission expressed its concern that the acquisition may cause “foreclosure strategies” that could “reduce competitors in marketplaces for distribution of consoles and personal computers for video games, as well as operating systems for PCs,” pushing it to pursue a deeper investigation.
The EU issued a press release explaining its decision in relation to its initial investigation. The press release emphasizes its possibility Microsoft could block its rivals from playing Activision Blizzard’s consoles and PC games, particularly Call of Duty.
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The commission also explains the ways in which Microsoft already has an extensive customer base through its many resources, including its Windows PC operating system and cloud computing service Azure.
The company also emphasized its reputation as a game designer as well as publisher and distributor. With the acquisition proposal of an organization with similar significant games industry roles The EU is of the opinion that battle for console and PC video games distribution and multi-game subscription services and cloud-based game streaming services could decrease.
“The preliminary analysis suggests that Microsoft might be able and an economic incentive to use foreclosure strategies against Microsoft’s rival companies that distribute console video games, for example, prohibiting these companies from selling the games from Activision Blizzard’s consoles on consoles, or degrading the terms and conditions that govern the use or access to these games.” EU added.
“When it is about multi-game subscription services and/or cloud-based streaming services for games particularly the case of cloud-based game streaming services, The Commission fears that after acquiring Activision Blizzard, Microsoft may restrict access, to the disadvantage of its competitors of console and PC games that provide the same services to its own console and PC video games that are the key to the development of these services, which are still in the beginning stages of multi-game subscriptions and cloud-based game streaming.”
The EU also stated that should Microsoft adopt these actions, the general public may find themselves facing higher prices for games, but with less innovation and quality with their game. In addition, the commission states that Microsoft may make use of the merger to improve the image and reputation associated with the Windows computer system, and to stop people from buying PCs that are not Windows-based.
In the final analysis at the end, the EU stated that it would conduct a more thorough investigation for 90 days running until 23 March 2023.
