The UK’s Competition and Markets Authority (CMA) recently imposed restrictions on Microsoft’s proposed acquisition of Activision Blizzard, the makers of Call of Duty, due to concerns about Microsoft’s potential dominance in cloud gaming. In a further blow to Microsoft, the regulator has now prevented the two companies from acquiring any interests in each other without prior written consent. BBC reported that the CMA’s interim order applies to both businesses and their subsidiaries.
Importance of the Microsoft-Activision deal
More than a year ago, Microsoft announced a $68.7 billion deal to acquire Activision Blizzard, which would give them access to popular gaming titles such as Call of Duty, Overwatch, and World of Warcraft. However, Sony expressed objections to the deal, arguing that Microsoft would seek to damage PlayStation Console Business by making Call of Duty exclusive to Xbox. Microsoft denied this and attempted to convince regulators via provisional deals with Nintendo, Nvidia, and other cloud gaming firms. Sony remained unconvinced, fearing that Call of Duty’s quality would suffer on Sony consoles.
CMA’s view of the deal
The UK regulator expressed concerns that the deal would limit innovation and choice for gamers in the cloud gaming space. Microsoft and Activision criticised the decision and indicated that they would appeal it. Moreover, both companies have warned that they will need to reconsider their investments in the market.
It is worth noting that regulatory bodies in the United Kingdom, the United States, and the European Union must approve the deal in order for it to proceed. Reuters has recently reported that the EU is expected to greenlight the deal on May 15.
Importance of the Microsoft-Activision deal
More than a year ago, Microsoft announced a $68.7 billion deal to acquire Activision Blizzard, which would give them access to popular gaming titles such as Call of Duty, Overwatch, and World of Warcraft. However, Sony expressed objections to the deal, arguing that Microsoft would seek to damage PlayStation Console Business by making Call of Duty exclusive to Xbox. Microsoft denied this and attempted to convince regulators via provisional deals with Nintendo, Nvidia, and other cloud gaming firms. Sony remained unconvinced, fearing that Call of Duty’s quality would suffer on Sony consoles.
CMA’s view of the deal
The UK regulator expressed concerns that the deal would limit innovation and choice for gamers in the cloud gaming space. Microsoft and Activision criticised the decision and indicated that they would appeal it. Moreover, both companies have warned that they will need to reconsider their investments in the market.
It is worth noting that regulatory bodies in the United Kingdom, the United States, and the European Union must approve the deal in order for it to proceed. Reuters has recently reported that the EU is expected to greenlight the deal on May 15.
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