Posts: 757 +29
Why it matters: Microsoft's $69 billion bid to acquire the publisher behind Call of Duty and Overwatch is already facing extra scrutiny in the United Kingdom. Now it appears the European Union will bring its investigation into the deal to a new phase.
Sources told Reuters and Politico this week that Microsoft opted not to provide any concessions to European Commission regulators regarding its plans to acquire Activision Blizzard. As a result, the EU's examination of the bid will enter phase 2 by next week, echoing the deeper scrutiny UK regulators are placing on the acquisition.
A Microsoft spokesperson said the company would keep working with the Commission to address any concerns. Although Microsoft submitted no official remedies to UK or EU authorities, it recently said it would continue releasing Call of Duty games on rival PlayStation consoles indefinitely to assuage Sony's primary reason for opposing the deal.
Sony isn't just worried about Microsoft potentially taking the massive shooter franchise away from PlayStation. It also thinks Microsoft placing Call of Duty on Xbox Game Pass and Xbox Cloud Gaming would make the company too dominant in the subscription and cloud gaming sectors. However, Microsoft's reply to the UK's examination suggested it would honor a prior deal between Sony and Activision Blizzard that would keep Call of Duty off of its subscription services for years even if Microsoft bought Activision.
Brazilian regulators approved the deal unconditionally after their examination hosted public arguments between Sony and Microsoft. The Brazilian government doubted Call of Duty was essential to PlayStation's survival and said its job wasn't to protect individual competitors.
Despite much of the attention surrounding the acquisition centering on Call of Duty, Microsoft has admitted it mainly wants Activision Blizzard for PC and mobile gaming. A report earlier this year shows that a significant portion of Activision Blizzard's money came from King — the maker of Candy Crush and Farm Heroes.
Another regulator Microsoft might have trouble with is the United States Federal Trade Commission (FTC). Reports indicate the FTC's investigation is still in the early stages, and any decision won't arrive until around late November. Saudia Arabia was the first country to accept the buyout, but Microsoft will also need approval from Australia, New Zealand, Japan, and South Korea.