Antitrust authorities initiate investigation against Microsoft

Microsoft, which is set to acquire Activision Blizzard, is facing another government probe over the acquisition. The British antitrust authority CMA should clarify whether the takeover will restrict competition in the United Kingdom.

Britain’s Competition and Markets Authority (CMA) recently announced that it had opened an investigation into Microsoft’s proposed acquisition of Activision Blizzard. The almost $69 billion acquisition has been announced by Microsoft in January.

Antitrust authorities investigate Microsoft / Activision Blizzard

The CMA is trying to figure out how the acquisition could affect competition in the gaming industry, including hints at “higher prices, lower quality, or limited choice” for consumers that could result from the acquisition. The CMA investigation is designed to determine whether Microsoft’s acquisition of Activision Blizzard would constitute a concentration within the meaning of the Enterprise Act 2002.

If the transaction is determined to be a “Merger Relevant Situation,” the CMA will initiate a Phase 2 investigation. That investigation will then determine whether the concentration would result in, or could be expected to result in, “a significant restriction of competition in one or more markets for goods or services in the United Kingdom”. By September 1, the CMA plans to announce whether or not they will initiate a Phase 2 investigation.

Not the first investigation

The CMA’s merger investigation isn’t the first regulatory scrutiny Microsoft has faced over its proposed acquisition of Activision Blizzard. Last month, the United States Federal Trade Commission also launched an investigation to determine the potential impact of the acquisition on Activision Blizzard employees because the company reportedly fosters a “fratboy culture” and because of the recurring incidents of sexual abuse that are being ignored.

There were also various other scandals. Most recently, the company faced a mass employee walkout at Activision Blizzard King to protest the company’s healthcare policies.

However, Liza Tanzi, Microsoft’s Corporate Vice President and General Counsel, said earlier that such investigations are expected and appropriate. She also said that Microsoft remains confident that the deal will go ahead as planned in fiscal 2023.

“We have been clear about how we intend to run our games business and why we believe the deal will be beneficial for gamers, developers and the industry,” Tanzi said in a statement to CNN. “We are committed to answering regulators’ questions and ultimately believe that a thorough review will help ensure the deal can be completed with broad confidence and that it will have a positive impact on competition.”

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