Microsoft’s Activision Takeover Hits Further Snags as EU Makes Objections Official

Microsoft Corporation (NASDAQ: MSFT) seems to have its hands full of late with multiple anti-trust issues cropping up from its pending acquisition of Activision-Blizzard as regulators continue piling on a deal that would make Microsoft the largest player in multiple game genres and  potentially gain an unsurmountable lead in the video game industry where it currently trades blows with traditional rivals Sony and Nintendo in a bit to capture more of the $220.79 billion industry (source: Grandviewresearch) that seems set to project figures well north of half a trillion dollars by 2030. Microsoft’s upcoming acquisition seems to have raised more than a few eyebrows. This is because of both the sheer amount of intellectual property that publisher Activision-Blizzard controls as well its complete dominance of the First-Person Shooter (FPS) market by the Call of Duty franchise. This has seen its biggest industry competitor in terms of shared market, Sony to become increasingly vocal, both in public and privately to EU regulators as it highlighted an increasingly aggressive buying spree by the Redmond-based software giant in a bid to corner as much of the entertainment industry as possible to secure a lead for its Xbox and Microsoft Store platforms. Microsoft has already made sizeable purchases in the recent past where it has purchased studios and publishers such as Zenimax Media which includes ID Software, Bethesda and Arkane Studios to name a few and developers such as Rare and 343 industries as well as Minecraft developers Mojang.

Microsoft acquired Minecraft creator Mojang in 2014 for an eye-watering $2.5 billion in what was seen by many as an industry-first in terms of the acquisition of a single-title developer for over a billion dollars. It has since made multiple larger purchases in the same industry.

However the Activision-Blizzard takeover that clocks in at $68.7 billion dollars seems to eclipse all of Microsoft’s prior acquisitions by far and understandably so, has elicited a strong response by both, its competitors as well as industry professionals, many of which claim that this could in effect allow Microsoft to nail down a significant portion of the gaming market, especially Call of Duty players that tend to be a mix of casual and hardcore gamers. Microsoft however claims otherwise. It has attempted to assuage Sony’s concerns as well as those of the EU watchdog by categorically stating that it does not intend to sabotage or restrict PlayStation-based gamers from the Call of Duty franchise in any way whatsoever. Sony has already managed to get the FTC to file suit previously in response to avoid having to rubber-stamp the deal based on reports that seemed to indicate the EU regulators will compromise with Microsoft to allow the deal to be made whole. This however has resulted in Microsoft Subpoenaing Sony’s own records as it attempts to build a defense around refuting Sony’s claims that the acquisition will have serious anti-competitive ramifications.

While the EU’s formal letter of objections was an expected move, given that the FTC has already announced its objections, it might serve as nothing more than a distraction until the latter suit is settled or gets a ruling. Based on various industry insiders’ Tweets, the brunt of the legal battle will now be fought in US courtrooms while the EU regulators might stick to a more ‘lenient’ approach to the entire affair, admittedly with concessions by Microsoft which would see it legally bound to not make anti-competitive moves against market players, primarily Sony.


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Rahim Amir
Rahim Amir
A Tech Enthusiast that doubles down as both a Pokémon and Dota enthusiast by night and a system builder by day, Rahim tends to strive to find that elusive work-play balance even as the difference seems blurrier to him than most.
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