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European Union approves Microsoft’s acquisition of GitHub

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In June this year, Microsoft had marked one of the biggest acquisition, buying open source icon GitHub for $7.5 billion. Now that acquisition has got approval from the European Commission under the EU Merger Regulation.

The European Commission, a branch of the European Union, concluded that effective competition in the relevant markets would continue and Microsoft would have incentive to undermine the open nature of GitHub’s platform.

Both Microsoft and GitHub provide DevOps tools to enterprises and individual developers to develop and release software. Specifically, the companies deliver software development platforms, code editors, and integrated development environments to enable developers collaborate on source code.

While the code editors are computer programs used to edit source code, IDEs are applications that consist code editor and additional features like intelligent code completion.

“The Commission found that the combination of Microsoft and GitHub’s activities on these markets would raise no competition concerns because the merged entity would continue to face significant competition from other players on both markets,” the EU body said.

Microsoft had applied for the EU approval on 14th September. European Commission evaluated if Microsoft will take advantage of GitHub’s popularity to improve its own sales of DevOps tools and cloud services.

It also checked whether Microsoft would integrate its own DevOps tools and cloud services with GitHub and limit its integration with third party services.

“Microsoft is a developer-first company, and by joining forces with GitHub we strengthen our commitment to developer freedom, openness and innovation. We recognize the community responsibility we take on with this agreement and will do our best work to empower every developer to build, innovate and solve the world’s most pressing challenges,” Microsoft CEO Satya Nadella had said at the time of acquisition.

If Microsoft takes advantage of GitHub to promote its own DevOps tools and cloud services, while limiting integration of others, it can reduce the value of GitHub for developers. They would then prefer to switch to other platforms.

Also read: VS Code, React, and Tensorflow continue to be the top open source projects in 2018: GitHub’s State of the Octoverse 2018 report

Hence, the EU body said that GitHub acquisition wouldn’t raise any competition concerns in affected markets. The case has been cleared unconditionally following the first phase of investigation.

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