Brazilian watchdog clears Microsoft acquisition of Activision-Blizzard

Brazil’s competition watchdog has approved Microsoft’s acquisition of Activision-Blizzard. In the event that certain Activision-Blizzard games, such as Call of Duty, were released exclusively for Xbox, this would not disrupt the market.

The Brazilian Administrative Council for Economic Defense, CADE for short, announced its verdict in a report. It contains the vision of the watchdog about exclusive games on the gaming market and about the role of exclusive titles at Sony and Microsoft. Exclusive games are a benchmark for competition in the gaming market, especially between Microsoft and Sony. “However, neither of those two companies has yet developed or released an exclusive game that tipped the economic balance in any particular direction,” CADE said. Exclusive games are also less popular and less profitable compared to third-party games, according to CADE. AAA games available on both platforms.

In its judgment, the competition watchdog also refers to the Japanese game manufacturer Nintendo. “Nintendo doesn’t rely on Activision-Blizzard games to compete in the gaming market,” it said. In contrast, the Brazilian watchdog argues that Sony is a strong brand that has decades of industry experience, has one of the largest user bases, has a robust game catalog, has exclusive titles in its catalog and also maintains partnerships with other publishers. Sony would be able to remain competitive in the gaming market, according to CADE, even if the company could grant access to Activision-Blizzard games. Finally, the watchdog also explains its own position in this story because, according to the organization, it only serves to protect the interests of Brazilian consumers and not those of a particular company.

The Brazilian Administrative Council for Economic Defense is the second global competition watchdog to approve Microsoft’s acquisition of Activision-Blizzard. Saudi Arabia’s competition watchdog had previously green light given before the takeover. In Europe, the European Commission wants to investigate the takeover in detail. The British market authority CMA also wants to start an in-depth investigation.

Microsoft announced its intention to acquire Activision-Blizzard in early 2022 for $68.7 billion. If the deal goes through, it will be the largest gaming acquisition and Microsoft’s most expensive acquisition ever. Both companies are awaiting approval from global authorities and believe the deal will close in 2023.

One of the biggest titles in Activision-Blizzard’s catalog is Call of Duty. Shortly after news of Microsoft’s potential acquisition, Microsoft chief executive Phil Spencer stated that he would like to keep the game available on PlayStation and that Microsoft would respect existing agreements. Bloomberg news agency discovered that Sony has an agreement to bring three more Call of Duty games to PlayStation consoles.