In a statement, Microsoft’s president Brad Smith expressed his dismay at the decision made by the UK regulator to block its acquisition of Activision Blizzard, the maker of Call of Duty. He stated that this decision has greatly impacted confidence in the UK as a destination for tech businesses. The Competition and Markets Authority (CMA), an independent body, cited concerns about potential competition issues in the emerging cloud gaming market as the reason for blocking the deal.
However, Microsoft strongly disagreed with the CMA’s decision and criticized it as the “darkest day” in their four decades of operating in Britain. Smith further emphasized that this decision sends the wrong message to the global tech industry about the UK’s stance towards investment and job creation. He called for a closer examination of the CMA, the regulatory structure, the specific transaction, and the implications this decision has for the UK’s reputation.
Responding to Smith’s comments, a spokesperson for British Prime Minister Rishi Sunak dismissed his claims, stating that they are not substantiated by the facts. They stressed that the UK has a highly attractive tech sector and a growing games market, and that the government is committed to proactive engagement with Microsoft and other companies.
Smith also criticized the CMA for its lack of effective communication. He highlighted that while Microsoft cooperated with regulators in Brussels, the same level of cooperation was not experienced in London, contradicting the notion that the UK would be more flexible post-Brexit. Smith mentioned that Microsoft had responded to the CMA’s inquiries and had encouraged them to raise any further concerns, but received no communication thereafter. This, according to Smith, sends a clear message that the European Union is viewed as a more favorable environment for starting and selling businesses compared to the UK.
However, CMA Chief Executive Sarah Cardell defended the regulator’s decision, stating that their role is to ensure a competitive environment in which businesses can flourish. She maintained that the CMA’s decision was independent and based on a comprehensive assessment of the deal’s impact on competition, and believes it to be the right decision for the UK. Cardell also mentioned that the US Federal Trade Commission shares similar concerns regarding competition and is supporting the blockage of the deal.
Microsoft has announced its intention to appeal the decision, with strong support from Activision. The appeal process will go through the Competition Appeals Tribunal, where a judgment will be made based on the merits of the decision. It should be noted that this appeal does not provide an opportunity for Microsoft to introduce new remedies.
© Thomson Reuters 2023
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Eugen Boglaru is an AI aficionado covering the fascinating and rapidly advancing field of Artificial Intelligence. From machine learning breakthroughs to ethical considerations, Eugen provides readers with a deep dive into the world of AI, demystifying complex concepts and exploring the transformative impact of intelligent technologies.
