Activision Blizzard CEO Bobby Kotick has commented on the industry’s most discussed acquisition. He thinks that the UK risks turning into Death Valley if the Microsoft deal is eventually blocked.
Kotick shared his thoughts in a new interview with CNBC. Here are the key takeaways form the conversation regarding the $68.7 billion deal and regulatory pressure that Microsoft and Activision Blizzard currently face in the US, UK, and EU:
- Activision Blizzard CEO thinks that neither US nor European regulators know or understand the games industry;
- According to Kotick, Japanese companies like Sony and Nintendo dominate the business, not to mention Chinese tech giants like Tencent and ByteDance;
- He added that the UK should embrace the deal to create new jobs and opportunities for the country, especially in times of recession.
It isn’t really at all whether it’s Sony’s or Microsoft’s platform, it’s really about the future of technology. They’ve said now for the last year, I think Rishi Sunak has said they’d like to be the Silicon Valley of Europe, or of the continent, and if deals like this can’t get through, they’re not going to be Silicon Valley, they’ll be Death Valley. CEO of Activision Blizzard
Microsoft’s acquisition of Activision Blizzard is now under regulator scrutiny in several countries. The US Federal Trade Commission (FTC) sued to block the transaction, while the UK’s Competition and Markets Authority (CMA) and the European Commission are conducting in-depth investigations.
All three regulators are deeply concerned that the Activision Blizzard acquisition could hurt competition, giving Microsoft an unfair advantage in console, cloud, and subscription markets. The watchdogs are also worried that the company will try to make Call of Duty and other franchises exclusive to the Xbox ecosystem.
It is worth noting that Microsoft is in dire need to get a CMA approval. As explained by Bloomberg analyst Jennifer Rie, “if it chooses to block the deal, there is little recourse for the companies — UK courts rarely overturn a CMA merger decision.”
So the main question is what concessions Microsoft will have to make to clear the transaction and then get it approved in the US and European Union.