Microsoft to Defend Activision at Upcoming EU Antitrust Hearing

UTC by Tolu Ajiboye · 3 min read
Microsoft to Defend Activision at Upcoming EU Antitrust Hearing
Photo: Depositphotos

Tech giant Microsoft wants to wrap up its pending Activision deal by allaying antitrust fears at an EU hearing.

Microsoft Corporation (NASDAQ: MSFT) President Brad Smith will promote the proposed deal with Activision Blizzard (NASDAQ: ATVI) at an EU hearing. According to a Reuters report, Smith will lead a delegation of 18 senior executives at the closed hearing to try to convince EU antitrust regulators to allow the deal. These executives include Microsoft Gaming Chief Executive Officer Phil Spencer and Activision Chief Executive Officer Robert Kotick.

Since Microsoft announced its intent in January last year to acquire Activision, concerns have centered around potential gaming monopolization. Involved regulatory agencies and videogame mainstays have argued that the computer software giant could gain an unfair advantage via the Activision acquisition. The reason is that Microsoft would have sole control and rights to the videogame developer’s stable gaming titles. A notable example is the “Call of Duty” franchise, which is wildly popular across several gaming platforms. However, Microsoft continues to debunk such concerns as misplaced and counter-argues that its $69 billion Activision acquisition would actually boost competition. Smith plans to drive this message home at the EU hearing scheduled for today, February 21st.

Microsoft Attempts to Sway Stakeholders

At the EU hearing, Microsoft could also assess the mood and measure sentiments provoked by the proposed Activision acquisition. Those slated to listen to Smith’s address include senior European Union and national competition officials. Reuters also reported that European Commission lawyers would also sit in on today’s closed hearing.

Nonetheless, Smith seems optimistic about the outcome of the EU hearing, even telling reporters en route:

“I think we will make clear that our acquisition of Activision Blizzard will bring more games to more people on more devices and platforms than ever before.”

Microsoft also previously argued that it would share Activision’s popular gaming titles in a 10-year lease-like arrangement with rivals.

Microsoft Rival Present at Activision Deal EU Hearing

Microsoft’s primary gaming rival, Sony, which produces the PlayStation line of consoles, also sent its gaming chief to the hearing. Sony is leading the charge for those agitating against Microsoft’s pending takeover of Activision. The Japanese-based consumer electronics giant previously called on regulators, including the Federal Trade Commission (FTC), to block the deal.

Other tech-inclined mainstays, such as Alphabet (NASDAQ: GOOGL) and Nvidia Corporation (NASDAQ: NVDA), also participated in the hearing. Commenting on the hearing, a Google spokesperson explained:

“The European Commission asked for our views in the course of their inquiries into this issue. We will continue to cooperate in any processes, when requested, to ensure all views are considered.”

UK CMA Verdict

The EU hearing follows reports from earlier this month that the Microsoft-Acquisition deal was under further threat. The deal, which the FTC already sued to block last December, was flagged for anti-competitive tendencies by a UK regulator. According to the United Kingdom Competition and Markets Authority (CMA), the Activision acquisition harms the UK gaming community.

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