Load the Game

Japan’s competition regulator has approved Microsoft’s acquisition of Activision Blizzard

• Jacob Chambers
• March 28th, 2023

Japan’s competition regulator has concluded that it has no issue with Microsoft‘s proposed acquisition of Activision Blizzard, and will not be blocking the deal.

The Japan Fair Trade Commission has published a statement in which it says it has “reviewed the transaction and reached the conclusion that [it] is unlikely to result in substantially restraining competition in any particular fields of trade”.

It added that it “has notified the parties that the JFTC will not issue a cease and desist order, resulting in the completion of its review”.

In a document explaining its decision, the JFTC said the deal didn’t violate any of its anti-competition legislature, saying “the integration falls under the safe harbor criteria for vertical business combinations”.

Since “competing businesses” exist and games are distributed digitally, it was determined that there would be no supply constraints on other platforms as a result of the deal.

“Therefore,” it concluded, “the acquisition would not substantially restrain competition in any particular fields of trade.”

Microsoft will be relieved by the news as it continues its campaign to convince regulators that the merger will not harm competition, despite Sony’s protests to the contrary.

Last week, Microsoft received more good news when the UK’s Competition and Markets Authority (CMA) reversed its previous position that the acquisition would significantly reduce competition in the console gaming space.

The watchdog said on Friday that it had updated its provisional findings after receiving fresh evidence that alleviated some of its concerns about the $69 billion deal, most notably the concern that Microsoft would make Call of Duty an Xbox exclusive.

To the contrary of what the CMA had previously thought, new information “indicates that this strategy would be significantly loss-making under any plausible scenario,” so the decision to make Call of Duty exclusive to Xbox will not be profitable for Microsoft.

In a bid to gain approval for the deal, Microsoft has told regulators it’s willing to make each new Call of Duty game available on PlayStation the same day it comes to Xbox for a 10-year period, with full content and feature parity.

However, it has also told the CMA that there is “no basis” for extending the offer beyond this, claiming that “a period of 10 years is sufficient for Sony, as a leading publisher and console platform, to develop alternatives to Call of Duty”.

In an attempt to address concerns about the impact the merger will have on the cloud gaming market, Microsoft also recently announced several deals to bring Call of Duty to third-party cloud gaming platforms should the acquisition be approved.

The CMA’s final report ruling on the Activision Blizzard deal is due by April 26.