Activision Blizzard owns several phenomenal titles, played by tens of millions of people, from “Call of Duty” to “Candy Crush” (AFP/Archives/Ina FASSBENDER)
Microsoft announced on Friday the finalization of the acquisition of video game publisher Activision Blizzard, a few hours after receiving fire from the British Competition Authority (CMA).
Owner of Xbox consoles, Microsoft has brought into its fold a heavyweight in video games, publisher of the successful titles “Call of Duty”, “Diablo” and “Candy Crush”.
This is the final chapter in a saga that has lasted since January 2022, with Microsoft having managed to overcome initial opposition from British and American regulators to this $69 billion operation.
After receiving a refusal in April, Microsoft submitted to the British authority at the end of August an amended version of its plan to buy the American video game publisher.
This is “authorized by the CMA”, announced the British regulator in a press release.
This acquisition will make Microsoft the third global player in video games in terms of turnover, behind Tencent and Sony, thus passing Apple.
“The price tag is high, but Microsoft can afford it, so the financial implications aren’t too much of a concern. The gaming industry is huge and growing quickly, making the possibility of profit growth very exciting for Microsoft,” Sophie Lund-Yates, analyst at Hargreaves Lansdown, told AFP.
The global video game market is estimated at $300 billion by the consulting firm Accenture.
“Microsoft’s enormous weight means that other game makers will have to improve their tactics if they want to remain competitive,” she adds.
Microsoft is planning notable sales in the new version of its takeover project: Activision Blizzard’s online gaming rights – including those for the global hits “Call of Duty” and “Candy Crush” – will be sold to French company Ubisoft.
This sale concerns Activision’s online games (“cloud gaming” or “cloud streaming”) PC and console produced over the next 15 years (excluding the European economic area). It “will prevent Microsoft from blocking competition in the field (…) while this market is taking off”, welcomed the CMA.
– “Widely awaited” decision –
“We are grateful for the thorough review (of the new agreement) and the decision of the CMA today,” immediately reacted Microsoft President Brad Smith in a statement sent to AFP.
“We have now cleared the final regulatory hurdle to complete this acquisition, which we believe will benefit gamers and the gaming industry worldwide,” he added.
“We now have all the necessary regulatory approvals to close (the transaction) and we look forward to bringing joy and connection to even more players around the world,” added Activision CEO Bobby Kotick.
“Today’s decision was widely anticipated and brings to an end what has been a tumultuous process for all parties involved,” said Alex Haffner, competition lawyer and associate partner at Fladgate.
The CMA feared that the operation in its initial format would reduce competition too much in the dematerialized games market. Microsoft dominates it with more than 25 million subscribers to its dedicated online platform.
If Sony and Nintendo have launched a similar service, the offer “has absolutely nothing to do” with that of the American giant in terms of the catalog of games available and the power of the “cloud” infrastructure offered, explained to the AFP Julien Pillot, economist specializing in cultural industries, last April.
Other tech giants have also launched into this niche, such as Amazon (Luna), with much less success.
The European Commission, for its part, approved this acquisition in May.
The American Competition Authority, the FTC, for its part, suspended in July the administrative court proceedings that it had initiated in December against the acquisition as it was initially envisaged.
Microsoft had challenged the British blockade in court. But at the beginning of July, he preferred to suspend the legal proceedings to find common ground with the regulator.
© 2023 AFP
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