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Microsoft Starts Charm Offensive to Push Through Activision Deal

Microsoft on Wednesday launched a charm attack in Washington seeking government approval for its $ 70 billion deal to buy video game company Activision Blizzard, saying it would not give preferential treatment to its own games in its App Stores.

Microsoft chief executive Satya Nadella and its president Brad Smith told a news conference in Washington that they planned to meet with officials to discuss the deal. Mr. Smith said they are “sharing with members of Congress where we are going” and the company is “meeting with the think tank community and the like.”

Regulators are expected to give a tough review of the proposed acquisition of Microsoft Activation – the largest in Microsoft’s history. The deal will connect Activision, which includes games like Call of Duty and World of Warcraft, to Microsoft’s Xbox Operations, which releases hits like Hello and builds console and gaming subscription services.

To proceed with that investigation, Microsoft executives brought a list of promises.

“We are proposing to write the largest check in the history of Microsoft for $ 68 billion and only if 17 governments around the world approve the transaction will it be allowed to write the check,” he said. Said Smith. “We want to make it clear to regulators and the public that if this acquisition is approved, they can trust Microsoft to accept the emerging rules.”

Mr. Smith and Mr. Nadella said he was committed to easing restrictions on how other developers could gain access to Microsoft’s App Stores. They said they would not force other developers to take payments from users using Microsoft’s systems, would allow game developers to talk directly to players and would not promote the company’s own games on rival products.

Microsoft has promised that major Activision franchises, such as Call of Duty, Sony PlayStation, will continue to be available on an Xbox rival, outside of the company’s current agreement with the company.

Microsoft executives have accepted a tough challenge from the Biden administration to get their blockbuster deals approved amid mounting scrutiny of major tech companies. Lina Khan, chairman of the Federal Trade Commission, is a critic of tech giants such as Facebook’s parent company Amazon and Meta.

Under it, the agency sued chip maker Nvidia for blocking Arm’s acquisition and promised to be more aggressive in investigating mergers and acquisitions. She began the process of tightening standards on so-called vertical mergers, which could include a merger of two companies with a supply chain, Microsoft’s bid for activation.

Microsoft may also face challenges abroad. Britain and EU regulators are more aggressive in filing no-confidence lawsuits against tech giants or blocking their acquisitions.

Microsoft says Activision will help it compete in a new business called so-called metavars or virtual worlds where some tech companies believe people can work and play.

Mr. Nadella said the key message was that Microsoft would not dominate gaming if the merger was approved. The company will become the third largest provider of video games with about 13 percent market share, he said.

Mr Nadella said.

Mr. Smith said Microsoft supported the no-confidence motion to show members of Congress that the company would not fight what it saw as mandatory rules.

“We are not in the world of 2018 and 2019,” he said. “We know that any major allegations made by a major tech company will be further investigated. We need to move forward quickly and transparently and clarify how we manage this. “

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