This is another small step for Microsoft today in their race to buy Activision Blizzard King, as Chile has just validated the purchase without launching further investigations.
Chile validates Microsoft’s takeover of Activision from Phase 1
It is therefore today that the FNE (Fiscalia National Economica) has issued a new rather positive verdict for Microsoft. Indeed, the Chilean antitrust authority officially believes that Microsoft’s takeover of the Activision Blizzard group would not have a negative impact on competition in the video game sector in relation to the Chilean public. One of the most important arguments put forward by the FNE concerns the activity of the two American groups themselves.
“These companies are active in the same segments: development, publishing and distribution of video games; and at different levels, with Microsoft producing the Xbox console and other video game platforms such as Game Pass, so their businesses overlap both horizontally and vertically.
The prosecutor’s office believed that the transaction was not likely to significantly lessen competition, taking into account, among other things, the habits and preferences of video game consumers in Chile.
As we explained to you recently in this article, Microsoft’s acquisition of ABK is a special case for the antitrust authorities, because it concerns companies that operate globally in very similar sectors, this is what we call a vertical merger. While the authorities may have reservations about the impact of such a takeover on the company, it is difficult for consumers to see a negative impact.
Concretely, FNE therefore assesses that this takeover would not have such great significance for the South American public. First of all, according to the FNE survey, South American and especially Chilean players are not particularly fond of Activision Blizzard games. After that, FNE explained that the revenue generated by Sony players for the benefit of ABK was significant enough for Microsoft to keep its word and continue to release ABK games on competing platforms.
These arguments are clearly targeted and far from concern the entire Xbox audience, but it will be interesting to see the conclusions of the next antitrust authorities around the world, because the obstacle course is not over for the Redmond company.
Lulu Cheng Meservey, Vice President of Corporate Affairs at Activision Blizzard, said the Chilean competition authority has agreed “regulators in other countries who also recognized the benefits of the transaction for competition and players.” According to her, more approvals like this one are expected “other responsible regulators are looking at the facts.”
The hardest part is yet to come for Microsoft
While Chile isn’t necessarily a country that counts hugely in video games, it’s nevertheless a new step for Microsoft that allows it to end the year on a slightly more positive note than the signals the FTC is sending in the US in recent weeks.
As a reminder, the US antitrust organization has proven particularly hostile to the takeover and has officially launched legal action to block the process initiated by Microsoft. The latter had quickly reacted by indicating that he would go to court to defend himself. Its president, Brad Smith, had also invited Sony to the negotiating table, showing some irritation at Sony’s rejection of the various Microsoft proposals put on the table.
We continue to believe that this agreement will expand competition and create more opportunities for players and game developers. We have been committed since day one to addressing competition concerns, including offering proposed concessions to the FTC earlier this week. Although we believed in giving peace a chance, we have full confidence in our case and welcome the opportunity to present our case in court.
Be that as it may, the road is still long for Microsoft as we still await the return of two major global jurisdictions, the European Commission and the CMA in the UK.
To understand everything about this historic takeover and discover the upcoming schedule in 2023, we invite you to consult our complete file on the efforts of the takeover of Activision for Microsoft.
