UK to block Microsoft’s Activision Blizzard deal
Highlights of the story
- The UK’s Competition and Markets Authority has blocked Microsoft’s bid to acquire Activision Blizzard.
- The regulatory body cites Microsoft’s gains in cloud gaming as a major reason.
- It will be an uphill battle for Microsoft to appeal the decision.
This is official. Microsoft’s $69 billion deal has been blocked in Britain. Microsoft will not be allowed to acquire Activision Blizzard at this time. The regulatory body released its findings this morning, and while they don’t believe the deal will reduce competition in console gaming, they believe the deal will reduce competition in cloud gaming. The CMA released a summary of its decision in an update..
The Competition and Markets Authority (CMA) has found that Activision Blizzard Inc. by Microsoft Corporation (Microsoft). A substantial reduction is not expected as a result of the anticipated acquisition (merger) of Activision. Competition in Console Gaming Services in the UK (SLC). However, the CMA has found that an SLC in cloud gaming services in the UK can be expected to result from the merger.
The decision is a major setback for Microsoft in its quest to expand its gaming service and expand its Game Pass offerings. Microsoft’s bid to acquire Activision Blizzard is largely driven by its ability to own the Call of Duty franchise, one of the largest gaming franchises in the world, and a game series that significantly boosts Game Pass. would give
These concerns about cloud gaming are the only reason to block the acquisition. CMA believes that making Call of Duty console exclusive would not be beneficial, but they could make Activision games exclusive to Microsoft’s own cloud platforms, pulling it back from other cloud services, such as GeForce Now and Luna. are
The CMA also found Microsoft’s remedies, such as its deals to bring Call of Duty to GeForce Now and Nintendo, were insufficient. This decision was unexpected. Last month, the CMA found it had no evidence the acquisition would reduce competition in the UK, although it was studying further the deal’s impact on cloud gaming.
CMA doesn’t seem to believe that Dell won’t disrupt the cloud gaming market. We will wait and see what happens next. Financial Times reported earlier this week. That the CMA will approve the deal today. The winds pointed to that, and it really looked like the regulatory body would approve the deal.
Microsoft and Activision have reacted to the decision. “Today’s report from the CMA is a major blow to the UK’s ambitions to become a tech hub, and we will work with Microsoft to transform its appeal.” said the activation executive Lulu Cheng Meserui. According to Microsoft VP Brad Smith, Microsoft will appeal the decision.
Microsoft will appeal the CMA’s decision. pic.twitter.com/gqcStBnA8F
— Klobrille (@klobrille) April 26, 2023
Microsoft will appeal the decision, which itself could be a long and difficult process. Microsoft still needs approval from regulators in the US and EU, who are set to make their final decisions early next month. If the appeal fails, the activation Blizzard deal is as good as dead. regardless of, Microsoft is determined to close the deal..
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