by William D’Angelo , posted 5 hours ago / 1,607 Views
Chile’s regulatory authority, the Fiscalia Nacional Economica, has released its ruling on Microsoft’s Activision Blizzard acquisition and has voted to approve the deal in Phase 1.
The regulatory authority of Chile stated the deal “was not suitable to substantially reduce competition considering, among other evidence, patterns and preferences of video game consumers in Chile.”
The report continues, “In its analysis of horizontal effects, the investigation ruled out risks, considering that in the markets where the parties overlap their activities the limits were not exceeded. market concentration thresholds established in the 2022 Horizontal Concentration Operations Analysis Guide , and that a large number of relevant competitors and a dynamic market were observed.”
Chile’s regulatory authority considered what would happen if Microsoft stopped releasing Call of Duty on competitor platforms, like PlayStation, and concluded Activision Blizzard “faces competitive pressure from players such as Electronic Arts, Take Two, Ubisoft and Epic Games, Sony and Nintendo, and that the relevance of Call of Duty would be comparatively less in Latin America than in other regions of the world.
“It was also considered that the number of consumers who would prefer to change the console in the face of a blocking strategy would also be lower, which was verified through a survey carried out with Chilean consumers, and that the significant income generated by PlayStation in favor of [Activision Blizzard] would discourage adoption. of a blocking strategy.”
The regulatory authority concluded that it “ruled out the risks of tipping in the marketing of next-generation consoles and in subscription services (such as GamePass), since [Activision Blizzard]’s video games, although important, are not the most relevant for game consumers. Latin America and that the players in this market offer highly differentiated services.
“Tipping occurs when, once a certain scale of operation is exceeded, the markets tend to concentrate and eventually close under a single or dominant actor.
“In relation to a possible risk of blocking customers, the Prosecutor’s Office concluded that Microsoft will not stop demanding video games published by third parties, since the computer video game distribution market has shown significant dynamism with the entry of new relevant players, highlighting the leading position held by Steam.
“On the other hand, in the video game distribution market for consoles there is significant competitive pressure from Sony and Nintendo, which would discipline the resulting entity and would operate as a relevant substitute client for competing publishers, including various players. and some of them are particularly relevant.”
Activision Blizzard EVP Corporate Affairs and CCO Lulu Cheng Meservey via Twitter stated that “Chile’s competition authority, FNE, has now approved our acquisition by Microsoft, joining regulators elsewhere that have also recognized the deal’s benefits for competition and players.
“As other responsible regulators review the facts, we expect more approvals like this one.”
Chile’s competition authority, FNE, has now approved our acquisition by Microsoft, joining regulators elsewhere that have also recognized the deal’s benefits for competition and players.
As other responsible regulators review the facts, we expect more approvals like this one.
— Lulu Cheng Meservey (@lulumeservey) December 29, 2022
The acquisition has also been confirmed to have been approved in Brazil, Saudi Arabia, and Serbia unconditionally.
A life-long and avid gamer, William D’Angelo was first introduced to VGChartz in 2007. After years of supporting the site, he was brought on in 2010 as a junior analyst, working his way up to lead analyst in 2012 and taking over the hardware estimates in 2017. He has expanded his involvement in the gaming community by producing content on his own YouTube channel and Twitch channel. You can contact the author on Twitter @TrunksWD.
More Articles
