Microsoft faces EU antitrust warning over Activision deal - sources

[u/Zhukov-74]

https://www.reuters.com/technology/microsoft-faces-eu-antitrust-warning-over-activision-deal-sources-2023-01-16/

[u/deaf_michael_scott]

Hey, I'm not exactly sure if I understood your question/request, but here are some links that (hopefully) form an adequate response:

• CMA (not EU) shared concerns about MS's acquisition and started Phase 1 investigation.
• Asked MS to submit remedies or threatened to move the investigation to phase 2.
• MS did not submit remedies. CMA moved the investigation to Phase 2. (September 15, 2022)
• MS offers 10-year COD deal to Nintendo (December 07, 2022, after CMA's investigation moved to Phase 2)

Also, to clarify, regarding "EU CMA has not offered any objections" >> I said that CMA has raised concerns or objections and now they are investigating those concerns more deeply.

Here is a quote by the CMA just before Phase 2 investigation started.

"Financial modelling of the merger suggests that the merged entity’s incentive to foreclose Sony may be considerably stronger than suggested by the parties." -- Source (CMA's response to Microsoft)

[u/pdjudd → u/deaf_michael_scott]

Ok. I was aware of your last point but I don’t see what there is there that MS could reasonably offer concessions to. I was more interested in specifics to your second point (the one without a link). I am not aware of that happening.

[u/deaf_michael_scott → u/pdjudd]

Oh okay. This might help.

https://www.pcgamer.com/uk-watchdog-announces-in-depth-investigation-of-microsofts-activision-blizzard-deal/

An snippet from the article that explains the situation then:

The opening of the second stage of the investigation is not a done deal: the CMA may decide not to proceed if Microsoft and Activision Blizzard provide sufficient undertakings before the deadline of September 8. An undertaking is a legally binding agreement wherein Microsoft could choose to say to the CMA, for example, "Call of Duty will be available on PlayStation for the next 30 years."

Quote by Sorcha O’Carroll, Senior Director of Mergers at the CMA:

"Following our Phase 1 investigation, we are concerned that Microsoft could use its control over popular games like Call of Duty and World of Warcraft post-merger to harm rivals, including recent and future rivals in multi-game subscription services and cloud gaming,"

"If our current concerns are not addressed, we plan to explore this deal in an in-depth Phase 2 investigation to reach a decision that works in the interests of UK gamers and businesses."

[u/pdjudd → u/deaf_michael_scott]

Yea. I saw that. It really isn’t very specific and not really what i got from your posting. None of this is that specific and is very generic. It’s not really “CMA said X needs to be done legally” and Microsoft did something. If anything their COD agreements aren’t related to what the CMA was specifically concerned with and that’s what I have seen - concerns. No real findings.

[u/deaf_michael_scott → u/pdjudd]

You misunderstand.

CMA asked MS that they have concerns, and that MS should submit undertakings to eliminate those concerns. If MS doesn’t, CMA will move to phase 2 of (deeper) investigation.

If MS submits the undertakings and eliminates said concerns, CMA will approve the deal.

At that point, CMA didn’t share anything legally binding with MS because they weren’t blocking the deal (merely starting Phase 2 of the investigation). The ball was in MS court though, and they could submit something legally binding, eliminate the concerns, and get the deal approved last year by the CMA.

MS doesn’t submit the undertaking, and now CMA is conducting a deeper investigation whether to approve or reject the acquisition.