Microsoft's $69 billion acquisition of Activision Blizzard has hit another obstacle as the EU has given the company a list of concerns it has over the deal. According to a report from Bloomberg, the European Commission (EC) has several objections Microsoft will need to address if the regulator is to approve the deal.
It is worth noting that the EC investigation into the Microsoft Activision Blizzard acquisition will run until April 11. At the moment, the EC has detailed “potential reasons” why it may block the merger. Those reasons have not been made public, although we already know that the EC has concerns the deal will impact competition.
Another point worth making is that this is all a standard part of the regulatory process. Importantly, Microsoft has already said it will make concessions to ensure the EC approves the deal. For example, the company has agreed to keep Call of Duty on Nintendo consoles for the next 10 years, while a similar offer is said to be in place for Sony.
Call of Duty is at the heart of the debate between Microsoft, Sony, and regulators. While Activision Blizzard has other major franchises such as Diablo, Candy Crush, and Warcraft, Call of Duty is the big money spinner. So much so that Sony has confessed Call of Duty is irreplaceable on PlayStation.
Of course, Microsoft is currently battling the Federal Trade Commission (FTC) in US courts. It is widely believed the outcome of that case will greatly influence the final decision the EC makes. While it seems on the surface Microsoft is losing the situation, the FTC case is rather flimsy because it relies on proving Microsoft gains an unfair advantage by purchasing Activision Blizzard.
Microsoft has repeatedly argued that it is currently nowhere near the market leader in the gaming industry, so adding Activision Blizzard will not impact competition.
In other Activision Blizzard news, the company is going to pay $35 million to settle charges brought by the Securities and Exchange Commission. According to SEC, the company “failed to maintain disclosure controls and procedures to ensure that the company could assess whether its disclosures pertaining to its workforce were adequate.”
SEC says that between 2018 and 2021 Activision Blizzard “lacked controls and procedures among its separate business units to collect and analyze employee complaints of workplace misconduct.”
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