The Redmond-based tech giant and the Bobby Kotick-led publisher will not fall into each other’s arms so quickly.

The European Union has formally warned Microsoft in an antitrust case. According to Politico sources, the EU has listed its concerns about the $68.7 billion deal. The European Commission has previously said it would scrutinize the acquisition closely because it “may significantly reduce competition on the markets for the distribution of console and PC video games, including multi-game subscription services and/or cloud game streaming services, and PC operating systems.”

In particular, the Commission pointed out that Call of Duty and additional IP would be held back from Activision Blizzard on other consoles, and competition would be reduced in subscription and cloud gaming services. And Microsoft’s response to Politico is the usual: the company will do everything it can to find a way to close the deal. The Commission started its investigation in November and will announce its final decision by March 23.

Microsoft has already assured regulators that it will release Call of Duty on other consoles. It would release the franchise on Nintendo Switch and Steam for ten years and offered Sony a similar term deal if the Redmond-based company could absorb Activision Blizzard King. Jim Ryan has told Gamesindustry that he finds the offer unacceptable on several points. Meanwhile, the US Federal Trade Commission (FTC) has sued Microsoft, and the UK Competition and Markets Authority are also investigating.

The US Securities and Exchange Commission (SEC) has fined Activision Blizzard King $35 million for failing to put in place a system to deal with workplace misconduct and for violating a whistleblower protection rule, which the company agreed to pay. According to the SEC, there were deficiencies in the publisher between 2018 and 2021 because it did not have enough information to understand the volume and substance of the complaints.

Between 2016 and 2021, former employees were also required by Activision Blizzard to tell them if they were contacted by the SEC due to information requests, violating “the Whistleblower Act.” According to Jason Burt, director of the SEC’s Denver Regional Office, preventing former employees from communicating with the SEC “is not only bad corporate governance, but it is also illegal.”

In November 2021, the Wall Street Journal reported that Kotick knew about allegations of sexual harassment and abuse within the company but hid them from investors. In July 2021, the California Department of Fair Employment and Housing (DFEH) also filed a lawsuit against Activision Blizzard for discrimination and sexual harassment. The $35 million is not a lot, as the publisher made $1.78 billion in net revenue in one quarter…

Source: Gamesindustry, PSL