EU investigates Microsoft’s deal to buy Activision Blizzard

BRUSSELS (AP) — The European Union has launched an investigation into Microsoft’s planned takeover of video game giant Activision Blizzard, fearing the $69 billion deal would distort fair competition in the market.

Microsoft, maker of the Xbox gaming system, first announced the agreement to buy the California-based game publisher in January, but it still awaits scrutiny from antitrust regulators in the U.S., Europe and elsewhere. If it goes through, the all-cash deal would be the largest in the history of the tech industry.

Members of the European Commission, the 27-nation bloc’s executive arm, said in a statement Tuesday that “the point is to ensure that the gaming ecosystem remains vibrant to the benefit of users in a sector that is evolving at a fast pace.”

“We must ensure that opportunities remain for future and existing distributors of PC and console video games, as well as for rival suppliers of PC operating systems,” the commissioners said. The commission has until March 23, 2023, to decide whether to approve the deal.

At the heart of the dispute is who gets to control future releases of Activision Blizzard’s most popular games, especially the first-person military shooter franchise Call of Duty. Activision this week said its latest installment, Call of Duty: Modern Warfare 2, has already made more than $1 billion in sales since its Oct. 28 launch.

Microsoft’s console rival Sony, maker of the PlayStation, has brought its concerns about losing access to what it describes as a “must-have” game title to regulators around the world. In response, Microsoft has promised to keep Call of Duty on the PlayStation “for at least several more years” beyond its current contract with Sony. It also has said it might make it available on Nintendo’s Switch console, where the game isn’t currently available.

While Brazil and Saudi Arabia have already approved the deal, it still awaits important decisions from the U.S. Federal Trade Commission and authorities in the U.K. and the European Union.

Microsoft told investors in October that it still expects the deal to close by the first half of next year. But it’s possible regulators could impose conditions that force Microsoft to keep access open to Call of Duty for longer and ensure that its rivals aren’t getting a lesser version.

Among those listening to Sony’s concerns are antitrust regulators in the United Kingdom. Last month, they escalated their investigation into whether Microsoft could make Call of Duty and other titles exclusive to its Xbox platform or “otherwise degrade its rivals’ access” by delaying releases or imposing licensing price increases.

“These titles require thousands of game developers and several years to complete, and there are very few other games of similar caliber or popularity,” according to a September report from the U.K.’s Competition and Markets Authority.