Microsoft’s $69 billion acquisition of publisher Activision Blizzard took another step toward the finish line when it received approval Friday from China’s competition regulators.
China’s State Administration for Market Regulation approved the deal without any conditions, according to the AP. This comes a week after the European Commission, the executive body of the European Union, gave approval to the merger on the condition that Microsoft address the commission’s concerns about competition in the video game industry.
Microsoft first announced its plans to acquire Activision Blizzard in January 2022. Closing the deal would make the Xbox maker one of the top three video game publishers, right behind its rival Sony . Activision Blizzard is one of the largest third-party publishers, with some major franchises that could provide a much-needed boost to Microsoft’s catalog of games, including Call of Duty, Candy Crush and Overwatch.
Although Microsoft has won some merger-related battles recently, it still has some hurdles to clear before the deal is completed.
Who is left to approve the deal?
Microsoft still needs to receive approval from US regulators. The Federal Trade Commission filed a lawsuit in December to challenge the acquisition, saying the deal would “enable Microsoft to suppress competitors in its Xbox gaming consoles and in fast-growing subscription and cloud-gaming business.”
A hearing for the case is set for August 2.
In April, the Competition and Markets Authority blocked the $69 billion deal, saying it would result in higher prices and fewer choices for players.
Microsoft continues to deny the deal would hinder competition within the video game industry and continues to negotiate with regulators to gain approval.
What does this deal mean for players?
For Xbox Game Pass subscribers, the deal means that Activision Blizzard’s catalog of games will be included in the service, probably similar to how Bethesda games have been in the past. Microsoft acquired the company in 2020.
How players who do not have an Xbox, and instead use a Sony PlayStation or Nintendo Switch console, will be affected is not very clear. Critics of the deal worry that Microsoft will make future games developed by Activision unavailable on rival consoles. (Microsoft only does this for a game developed by Bethesda.) This is especially true of a major Activision title like Call of Duty.
Microsoft has agreed to a 10-year deal with Nintendo to bring Call of Duty games to its consoles, but Sony has reportedly rejected the same deal. Sony remains opposed to the deal and continues to submit filings to regulators about its concerns over the acquisition.
What is cloud gaming?
Cloud gaming is the technology of streaming video games remotely to a device such as a phone, tablet or smart TV. While the technology has been around for over a decade, it’s only in recent years that it’s really taken off thanks in part to it being an additional feature for Microsoft’s Xbox Game Pass and Sony’s PS Plus.
Other companies are developing their own cloud gaming services, such as Amazon’s Luna and GeForce Now. The former made a deal with Microsoft in February to bring more of its games to the service over the next 10 years.