Microsoft, maker of the Xbox game system, first announced the deal to buy the California-based game publisher in January, but is still awaiting review by antitrust regulators in the US, Europe and elsewhere. If completed, the all-cash deal would be the largest in tech industry history. Members of the European Commission, the executive arm of the 27-nation bloc, said in a statement on Tuesday that “the point is to ensure that the gaming ecosystem remains alive for the benefit of users in a rapidly evolving sector.” “We must ensure that opportunities continue to exist for future and existing video game distributors for PCs and consoles, as well as competing PC operating system vendors,” the commissioners said. They have until March 23, 2023 to decide whether to approve the deal. At the heart of the dispute is who will be able to control future versions of Activision Blizzard’s most popular games, especially the military first-person shooter franchise Call of Duty. Activision this week announced that its latest installment, Call of Duty: Modern Warfare 2, has already made more than $1 billion in sales since its October 28 release. Microsoft’s console rival Sony, maker of the PlayStation, has taken its concerns about losing access to what it describes as a “must-have” gaming title to regulators around the world. In response, Microsoft promised to keep Call of Duty on PlayStation “for at least several more years” beyond its current contract with Sony. He also said that he may make it available on Nintendo’s Switch console, where the game is currently unavailable. In a preliminary investigation, the EU found potential antitrust issues with video game distribution and cutting off access to Microsoft’s competitors. The bloc said it “has concerns that the proposed acquisition may reduce competition in the market for computer operating systems.” Microsoft said it would continue to work with the European Commission on next steps “and to address any valid market concerns.” “Sony, as an industry leader, says it is concerned about Call of Duty, but we have said we are committed to making the same game available on the same day on both Xbox and PlayStation,” Microsoft said in a statement on Tuesday. “We want people to have more access to games, not less.” Activision Blizzard CEO Bobby Kotick said in an email to employees on Tuesday that global competition in the video game industry makes it “understandable that regulators are trying to better understand the gaming industry.” However, he said “the process is progressing as we expected” and predicted the deal would close by June. “We will continue to work with the European Commission where, in the countries they represent, we have many employees,” Kotick wrote. He highlighted Brazil’s recent approval, saying the country’s competition authority understands that “we operate in a highly dynamic and competitive industry and that the merger will not harm competition in any way.” Saudi Arabia has also signed the deal, but is still awaiting major decisions from the US Federal Trade Commission and authorities in the UK and EU. Tuesday’s decision was another example of how the EU has led the way in regulating big tech companies, launching antitrust investigations, imposing tough data privacy regulations and pushing through landmark rules that threaten online platforms with billions in fines. unless they respect fair market conditions it reduces harmful content such as hate speech and misinformation. It’s possible that regulators will impose conditions on the game deal that force Microsoft to keep access to Call of Duty open for longer and ensure that its competitors don’t get a lesser version. Among those listening to Sony’s concerns are antitrust regulators in the UK. Last month, they escalated their investigation into whether Microsoft could make Call of Duty and other titles exclusive to the Xbox platform or “otherwise degrade access for its rivals” by delaying releases or imposing licensing price hikes. “These titles require thousands of game developers and several years to complete, and there are very few other games of similar caliber or popularity,” according to a September report by the UK’s Competition and Markets Authority.
