Microsoft & Activision Blizzard merger is a go with conditions, says EU regulators

Microsoft and Activision Blizzard logos

On Monday, the European Commission approved the proposed acquisition of Activision Blizzard by Microsoft under the EU Merger Regulation. The approval is one where conditions have to be met to address the Commission's competition concerns.

The commitments "fully address the competition concerns identified by the Commission and represent a significant improvement for cloud gaming as compared to the current situation," the regulator said.

The decision was made following an investigation into the proposed acquisition, which initially found Microsoft could harm competition in the console and PC game market, as well as in the supply of operating systems for PCs. An in-depth market investigation then found Microsoft wouldn't harm rival consoles or rival multi-game subscription services.

However, that in-depth investigation also determined Microsoft could still harm competition in the distribution of games via cloud game streaming services, and that its PC OS market position would be strengthened.

To counter the concerns, Microsoft offered licensing commitments that would last for ten years. This included a free license to EEA consumers to stream all current and future Activision Blizzard PC and console games where they already own a license, and a free license to cloud game streaming providers to allow gamers to stream those same games.

"Video games attract billions of users all over the world. In such a fast-growing and dynamic industry, it is crucial to protect competition and innovation," said Margrethe Vestager, executive VP in charge of competition policy at the Commission.

"Our decision represents an important step in this direction, by bringing Activision's popular games to many more devices and consumers than before thanks to cloud game streaming."

While Europe has given the stamp of approval, it doesn't help Microsoft's situation in the UK, which has already been halted by regulators over potential reduced competition in cloud gaming. On May 5, the Competition and Markets Authority went further, publishing an interim order limiting acquisitions between the companies by forcing them to obtain "prior written consent" from the regulator.

Microsoft plans to appeal against the CMA.