Microsoft closes US$69 billion Activision deal after winning Britain’s nod of approval

Microsoft, the tech giant behind the Xbox, has successfully closed a $69 billion acquisition deal with Activision Blizzard, a leading video game publisher known for hits like Call of Duty. This move significantly bolsters Microsoft's position in the gaming industry, allowing it to better compete with industry leader Sony. The deal, which was first announced in January 2022, faced its final major obstacle in the form of approval from the British government. This approval was granted after Microsoft agreed to sell streaming rights for Activision’s games to ensure competition in the market. The completion of this deal is a significant victory for Microsoft, as it aims to attract more users to its Xbox consoles and Game Pass subscription service. Phil Spencer, the CEO of Microsoft Gaming, expressed his excitement about the deal on the X social media platform, formerly known as Twitter. He will oversee the Activision business, with Activision’s CEO Bobby Kotick remaining in his position until the end of 2023. The acquisition is seen as a strategic move by Microsoft to penetrate the lucrative mobile gaming market, which is estimated to be worth over $90 billion. Activision is the publisher of popular mobile games such as Candy Crush Saga and Call of Duty Mobile. These games were not part of the cloud streaming deal Microsoft signed with France’s Ubisoft Entertainment to secure approval from Britain. Despite the successful closure of the deal, opposition from the US Federal Trade Commission (FTC) persists. However, analysts believe that the FTC’s challenge will have little impact on the deal. The main opposition to the deal came from Britain’s Competition and Markets Authority (CMA), which initially blocked the deal in April over concerns that it could give Microsoft a monopoly in the emerging cloud gaming market. The CMA later reversed its decision, stating that Microsoft’s concession on streaming was a “game changer”. The CMA’s decision to block the deal initially drew criticism from Microsoft, which claimed that Britain was closed for business. The British government offered limited support to the CMA, with Finance Minister Jeremy Hunt stating that while he did not want to undermine its independence, regulators also needed to focus on encouraging investment. The European Commission gave its approval to the deal in May, accepting Microsoft’s commitments to license Activision’s games to other platforms.