China Likely Next In Line To Approve The Microsoft-Activision Merger

The situation evolves further as the merger seems likely to garner more support.

By Saad Ali February 24, 2023

Story Highlights

According to Equity Report, China is likely to approve the Microsoft-Activision merger in the coming days.
Sony has continued to stand in opposition to this deal. Microsoft has offered proposals to Sony regarding the availability of Call of Duty which was promptly rejected.
In an attempt to garner support, Microsoft has signed a ten-year contract with Nintendo and Nvidia to bring Call of Duty and other Xbox games to a wider audience.
While the acquisition has certain merits, we must also consider the possible complications and risks that monopolies can pose.

As the situation around the Microsoft-Activision merger enters a new phase, China seems to be a likely candidate to provide the approval. Microsoft expressed its intent to acquire Activision Blizzard on 18 January 2022 for approximately US$69 billion.

Two antitrust lawyers working for China’s State Administration for Market Regulation (SAMR) stated that the country is “likely to approve Microsoft’s acquisition of video game publisher Activision Blizzard despite the process being slowed down by potential complaints” according to Equity Report.

Microsoft is facing certain complications regarding the acquisition at this moment. Regulators in the United States, EU, and the UK have objected to the merger. In an attempt to resolve the matter, Microsoft has promised to keep the Call of Duty franchise on competitor platforms.

Microsoft-Activision merger would bring a catalogue of games to a wider audience — The Microsoft-Activision merger would bring a catalog of games to a wider audience

At the moment, the only countries supporting the merger are Brazil, Chile, and Serbia. However, it seems that we’ll see some developments in the coming days. In light of China’s expected approval, it’s worth noting that Tencent is in favor of the merger.

Considering Tencent’s track record, it’s possible that the company sees merits in the future should this deal go through.

In addition, at a conference in Brussels earlier this week, Microsoft announced its ten-year contract with Nintendo in hopes of bringing Call of Duty to a wider audience along with more Xbox games. In an attempt to expand on cloud gaming and garner support, Microsoft also secured its deal with Nvidia to bring its games to GeForce Now.

We’ve now signed a binding 10-year contract to bring Xbox games to Nintendo’s gamers. This is just part of our commitment to bring Xbox games and Activision titles like Call of Duty to more players on more platforms. pic.twitter.com/JmO0hzw1BO

— Brad Smith (@BradSmi) February 21, 2023

Microsoft has previously commented on the market share statistics involving the company and its competitors. Satya Nadella, Microsoft CEO, stated that Xbox’s low market share in Japan would not hinder competition. Furthermore, he stated that regulators should consider these statistics in light of the merger.

Moreover, In order to ensure that Call of Duty stays on competitor platforms, Microsoft offered Sony a 15-year deal. This proposal was promptly rejected reflecting Sony’s staunch stance of opposition regarding the deal.

Microsoft’s vision for gaming is compelling enough to warrant the acquisition going through. With China seemingly preparing to approve the deal, this saga is on a fast track to its conclusion. However, we must also consider the possible implications of such acquisitions.

The gaming industry hangs in the balance as all eyes are on the Microsoft-Activision merger. We can hope that this leads to a brighter future for gaming filled with quality experiences, innovations, and healthy competition.

In the video ahead, we discuss the possibilities that can arise from such acquisitions.