China approves Microsoft’s $69 billion Activision Blizzard acquisition

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After a huge setback in the UK, China has unconditionally approved Microsoft’s plan to acquire Activision Blizzard in a $69 billion deal.

The news first came through SeekingAlpha with Microsoft further confirming that the deal has been approved by the State Administration for Market Regulation in China. As of now, the acquisition has been approved by Brazil, Chile, Saudi Arabia, Serbia, Japan, South Africa, and Ukraine.

While the company has been receiving approvals from various countries, they have not been able to convince the Competition & Markets Authority (CMA) in the UK, and the Federal Trade Commission (FTC) in the US yet.

Microsoft has also received the green light from the European Union (EU) regulators but with some conditions. Though the EU regulators stated that the deal itself would not reduce competition in the console gaming market it may affect the cloud gaming sector in coming years.

“The European Commission has required Microsoft to license popular Activision Blizzard games automatically to competing cloud gaming services. This will apply globally and will empower millions of consumers worldwide to play these games on any device they choose,” said Microsoft president Brad Smith in a statement.

Cloud gaming is becoming one of the most popular casual gaming methods in recent years and is expected to grow at a rapid rate as it offers several benefits to players who seek to enjoy light gaming without spending too much on expensive PCs or consoles.

Microsoft offered solutions through exclusive deals to various cloud gaming platforms, giving the latter royalty-free licenses to Activision games. While the CMA was not convinced that the offer will resolve the problem, the EU Commission agreed that it will increase competition in the market.

Sony, the only competitor for Microsoft in the console gaming market, is also strongly opposing the deal, claiming that the company plans to make Activision games exclusive to Xbox and PC and harm the competitive nature of the market.

Microsoft, on the other hand, claimed that making the game exclusive will only lead to losses for the company. It tried to offer the same solution to Sony but it was rejected.

The FTC is still investigating the deal and has released a scheduling order. For the UK market, Microsoft has planned to appeal the decision. Outcomes of FTC and CMA cases are potentially the most crucial ones yet to be seen in this saga.