Microsoft Said to Offer EU Concessions Soon to Secure Early Clearance
- In January, Microsoft and Activision Blizzard announced the partnership.
- Sony, the owner of the PlayStation, has a 10-year licence agreement as the remedy.
- The action by Microsoft might get early permission from EU regulators.
In order to avoid formal objections to its $69 billion (approximately Rs. 56,350 crore) bid for Call of Duty creator Activision Blizzard, Microsoft is likely to offer remedies to EU antitrust regulators in the coming weeks, according to sources with knowledge of the situation.
In order to better compete with market giants Tencent and Sony, the US software behemoth and manufacturer of the Xbox announced the deal in January.
Since then, it has encountered regulatory challenges in the United States, the United Kingdom, and the European Union. Sony has criticised the deal and even called for a regulatory veto.
The European Commission, which is looking into the transaction, has until January to submit a formal statement of objection, which includes a list of worries about the deal's potential effects on competition. Offering solutions prior to the release of such a document may speed up the regulatory procedure.
In the end, such a manoeuvre can result in an early approval from the European Commission and be used by the parties before other antitrust organisations. It is yet to be seen if the active complainants will accept these concessions (particularly in terms of breadth) and whether the CMA and the FTC would also accept behavioural remedies.
Another person with firsthand information indicated that Microsoft's solution will primarily include a 10-year licence agreement with Sony, the company that owns the PlayStation. Following the publication of the Reuters piece, shares of Activision increased by 2%.
Both Sony and the EU's competition watchdog, which must decide on the merger by April 11th, declined to comment. According to Microsoft, it is collaborating with the Commission to address legitimate market concerns. 'Sony, the market leader, claims to be concerned about Call of Duty, but we have stated that we are committed to making the same game available on both Xbox and PlayStation on the same day.
Not fewer people, but more, should have access to games 'a representative for Microsoft remarked. Brazil, Saudi Arabia, and Serbia have all given their unqualified approval to the deal.