The EU Has Shared Their Microsoft-Activision Decision With The Public

A month after clearing the Microsoft Activision deal, the European Commission has shared their decision.

The document was published here. The full decision is 258 pages long, and is detailed, but also clear, in terms of the definitions the EU used, the investigation details, and the conclusions that they made.

On page 205 of the document, we will quote certain passages about how EU thinks about the proposed remedies Microsoft made to get the deal approved under their jurisdiction.

On section 885, they state:

“Therefore, the Commission considers that the Final Commitments are as effective as a structural divesture and even have additional benefits that go beyond preserving the situation absent the Transaction.

Whatever part of the Activision Blizzard business Microsoft could have offered to divest, such divestiture would not have covered the entire existing and future games of Activision Blizzard. Furthermore, the Commission takes the view that the Final Commitments can be implemented and will be effective.”

The EU declares that the remedies Microsoft offered will have the same effect as if Microsoft divested part or all of Activision Blizzard King. In fact, they believe that the remedies are the better choice between the two. That is because forcing a divestiture of part of Activision Blizzard King, won’t be able to cover what happens to any future games the company makes, including games they hadn’t even planned yet.

On section 886, the European Commission states:

“In line with the above, the Commission considers that the Final Commitments have additional benefits that go beyond preserving the situation absent the Transaction, and are therefore more effective in addressing competition concerns than a prohibition.”

The EU here makes a distinction between their decision and the CMA’s. They wrote this perhaps with advance knowledge of what the CMA’s decision was going to be.

Vestager alluded to what could have been a disagreement between the two regulators, when they shared information with each other about the deal. That disagreement between the CMA and the EU being, that it would be better to make Microsoft commit to certain remedies, than to just block the deal.

In a speech, Vestager claimed that their point of disagreement was the matter of cloud gaming. In fact, as this decision document reveals, the EU decided to not splinted cloud and download or on-disc games when it comes to the gaming market.

Ultimately, as was written in line 886 on page 205 of the document, and Vestager publicly stated that the Microsoft Activision deal has pro-competitive effects. This was why they approved the deal, with some preconditions which they had decided would be enough to address their competitive concerns.