MS Unable to Present 'Anti-Monopoly Self-Remedy'... Concerns Over Blizzard Merger Failure

[Asia Economy Reporter Yujin Cho] Microsoft (MS)'s acquisition and merger (M&A) of Activision Blizzard is reportedly at risk of falling through due to antitrust regulatory hurdles, according to the New York Post citing an internal Blizzard source on the 6th (local time).

A Blizzard insider stated, "The two parties, who were confident that the deal would be finalized, are now experiencing discord as they have failed to agree on antitrust-related remedies demanded by regulators," adding, "There is also a possibility that MS may cancel the deal."

Initially, when announcing the merger with Blizzard, MS publicly declared that it would not convert Blizzard's flagship game 'Call of Duty' into an MS Xbox exclusive, but would continue to offer it on Sony, Nintendo, and other game companies' consoles. However, MS recently reversed this stance.

MS refused to comply with requests to prepare and submit remedies to resolve antitrust concerns ahead of the EU regulatory investigation starting on the 8th.

On the other hand, foreign media reported that Blizzard is demanding MS adopt a more accommodating position toward regulatory requirements and swiftly complete the acquisition, deepening the conflict between the two companies.

Experts noted that since MS initially aimed to secure game intellectual property (IP) through the Blizzard acquisition and establish a monopoly in the game distribution market, there is a possibility that the deal may fall through.

Dan Ives, an analyst at Wedbush, said, "MS's decision to acquire Blizzard was to secure a monopolistic market position," adding, "Abandoning that monopolistic position would mean the termination of the acquisition agreement."

Earlier this January, MS completed the largest M&A in the information and communication technology (IT) industry by acquiring Blizzard for $68.7 billion. With this acquisition, Blizzard rose to become the world's third-largest game company by revenue, following China's Tencent and Japan's Sony.

MS aims to complete the deal by June next year but must obtain approval from competition authorities in major markets including the EU, the UK, the US, New Zealand, and South Korea. Given that this deal occurred amid a global surge in antitrust regulations targeting big tech, it is expected to be challenging to remove regulatory obstacles.

Competitors and regulators are wary that MS might abuse its market position by exclusively releasing blockbuster Blizzard games on its game subscription service 'Game Pass' and blocking other game companies from entering platforms like PlayStation.

This content was produced with the assistance of AI translation services.