Microsoft’s $69 billion acquisition of publisher Activision Blizzard took another step toward the finish line when it received approval on 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 its approval of the merger on the condition that Microsoft address concerns the commission has regarding 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 into 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 would give a much-needed boost to Microsoft’s games catalog, including Call of Duty, Candy Crush and Overwatch.
Though Microsoft has won a few merger-related battles recently, it still has a few more hurdles to clear before the deal is done.
Who’s left to approve the deal?
Microsoft still has to receive approval from regulators in the US. The Federal Trade Commission filed a lawsuit in December to challenge the acquisition, saying the deal would “enable Microsoft to suppress competitors to its Xbox gaming consoles and its rapidly growing subscription and cloud-gaming business.”
A hearing for the lawsuit is set for Aug. 2.
In April, the Competition and Markets Authority blocked the $69 billion deal, saying it would result in higher prices and fewer choices for gamers.
Microsoft has continued to deny the deal would hamper competition within the video game industry and continues to negotiate with regulators in order to get approval.
What does this deal mean for gamers?
For Xbox Game Pass subscribers, the deal means Activision Blizzard’s catalog of games will be incorporated into the service, likely similar to how Bethesda games were when Microsoft acquired that company in 2020.
How gamers who don’t have an Xbox, and instead use a Sony PlayStation or Nintendo Switch console, will be impacted is less clear. Critics of the deal are concerned that Microsoft could make future games developed by Activision unavailable on rival consoles. (Microsoft did just this for game developed by Bethesda.) This is especially concerning for a major Activision title like Call of Duty.
Microsoft already agreed to a 10-year deal with Nintendo to bring Call of Duty games to its consoles, but Sony reportedly rejected a similar agreement. Sony remains against the deal and continues to submit filings to regulators about its concerns over the acquisition.
What is cloud gaming?
Cloud gaming is the technology to stream video games remotely to a device such as a phone, tablet or smart TV. While the technology has been around for more than a decade, it’s only in recent years has it really taken off thanks in part to it being an added feature for Microsoft’s Xbox Game Pass and Sony’s PS Plus.
Other companies developed their own cloud gaming services, such as Amazon’s Luna and GeForce Now. The former made an agreement with Microsoft in February to bring more of its games to the service over the course of the next 10 years.