Several parties oppose Microsoft’s acquisition of Activision Blizzard. It's believed that the US Federal Trade Commission is considering filing a lawsuit against the parties involved. This would be a major blow to the deal worth $68.7 billion.
The EU Commission and UK Competition and Markets Authority announced Phase 2 of their respective investigations into the deal. While this doesn't guarantee both said competition watchdogs would block the merger, it does delay the process by several months.
Having said that, reports suggest Microsoft is preparing to offer concessions to the EU Commission in order to help convince regulators to approve the deal. If successful, this could help shorten the regulatory process in favor of Microsoft and Activision Blizzard.
Reuters sources revealed that the concession would include a ten-year licensing deal to keep the Call of Duty franchise on the PlayStation Console. Recall that Sony has cried foul over Microsoft’s plan to make Call of Duty an Xbox-exclusive title after the current between Activision and Sony expires.
In a statement, Microsoft said it is committed to making the Call of Duty franchise accessible to more gamers. "Sony, as the industry leader, says it is worried about Call of Duty, but we've said we are committed to making the same game available on the same day on both Xbox and PlayStation. We want people to have more access to games, not less," Microsoft’s spokesperson said to Reuters.
The statement supports Phil Spencer’s statement that Microsoft is willing to extend a longer deal to Sony to keep the franchise accessible for PlayStation owners. Spencer is the CEO of Microsoft Gaming.
Sony recently claimed that the Call of Duty franchise is "irreplaceable" and said that the Battlefield franchise cannot keep up. The statement is part of the documents that Sony submitted to the UK CMA.
The EU Commission, however, has made it clear that this is more than just about Sony and the Call of Duty series. "The Commission is concerned that the proposed acquisition may reduce competition in the markets for the distribution of console and personal computers (‘PCs’) video games and for PC operating systems," the commission said in its report.
The EU Commission has until March 23, 2023, to finalize its findings regarding the deal. The commission can then decide what course of action it, or other entities, would make to finalize or disapprove the merger.
While the Microsoft concessions could hasten the approval by the EU Commission, there is no guarantee that UK’s CMA or the US FTC would also accept it. The CMA has until the start of March to finalize its report.
Microsoft and Activision Blizzard have until July to complete the merger before needing to renegotiate the terms of the deal. However, a lawsuit by the US FTC could force both parties to abandon the deal, as an unfavourable decision would inevitably led to a lengthy trial.