Microsoft has successfully closed its $69 billion deal to acquire Activision Blizzard, a significant move in the gaming industry. This acquisition was finalized after receiving the green light from the UK’s Competition and Markets Authority (CMA). The deal was initially unveiled in January 2022 and faced various regulatory hurdles, including concerns from the CMA about Microsoft’s potential dominance in the cloud gaming market. However, after Microsoft agreed to sell streaming rights for Activision’s games to address competition concerns, the deal was approved.
Now, for our young gamers and business enthusiasts, here’s why this matters to you! If you’re an avid gamer, you’ve probably played or at least heard of blockbuster titles like “Call of Duty,” “Candy Crush Saga,” and “World of Warcraft.” With this acquisition, Microsoft aims to strengthen its position in the gaming market, especially against competitors like Sony. This could mean more exclusive titles for Xbox users, better integration with Game Pass subscription service, and potentially even more innovative gaming experiences in the future.
Furthermore, this deal showcases the importance of regulatory bodies in ensuring fair competition in the market. The CMA’s intervention ensures that even as companies grow and merge, the market remains competitive, benefiting consumers like you with better prices, choices, and services.
THINK LIKE AN ECONOMIST!
Q1. Explain one reason why Microsoft would want to purchase Activision Blizzard.
Q2. Evaluate the impact that this acquisition is likely to have on different economic agents.
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