The Korea Fair Trade Commission (KFTC) has approved the Activision Blizzard acquisition by Microsoft unconditionally, leaving only the UK’s CMA and American FTC blocking the deal.
According to the filing (via VGC), the regulator found no cause to halt the deal. The Activision Blizzard acquisition by Microsoft has been in the works since it was first announced last year, but has run into major roadblocks from the UK’s CMA and US FTC despite broad support from other regulatory bodies.
In the filing the KFTC noted that they did not feel there would be any significant issue for game developers in Korea. “The combined market share of games developed and distributed by Microsoft and Blizzard [in Korea] is small, the popularity of Blizzard’s major games in Korea is not as high as overseas, and there are a number of popular game developers that competitors can deal with alternatively, so there is no possibility of foreclosure to exclude competing game service companies.”
Further pressure on the CMA
The approval of the deal by another regulator may seem business as usual, but it places further pressure on both the US FTC and more prominently the UK CMA. In a recent Twitter thread covering the Competition Appeal Tribunal involving the CMA and Microsoft, where both parties argued for the rapidity of proceedings, writer Florian Mueller covered the hearing in-depth, noting what he called “stalling” tactics and that for the American FTC the only recourse to halt the deal at this point would be an injunction. All in all it suggests that the CMA does not have any advantage in the hearing so far.
As the world’s authorities have lined up to back the deal observers and experts feel that the CMA’s position is weakened by focusing solely on cloud gaming and that it risks depicting Britain as being “closed for business”, which could negatively impact many deals and especially the UK video games industry, an industry which only recently saw a new framework laid out for research to support further business and government policy.
With another approval from another regulator, the CMA now stands to see mounting pressure to finish hearings and other legal proceedings or switch their position to approval. Especially after a very public disagreement with EU regulators that has only brought more attention to the CMA’s unique viewpoint.
