UK regulators obstruct Microsoft’s Activision Blizzard acquisition deal worth $68.7 billion – Microsoft’s proposed $68.7 billion acquisition of Activision Blizzard has been halted by the UK’s Competition and Markets Authority (CMA). The regulatory body has decided against approving the proposed acquisition, making it one of the most significant decisions in the history of video games. The authority noted in a post on Gov.uk that it believes Microsoft’s dominant position in the cloud gaming market to be the deal’s major obstacle.
UK regulators obstruct Microsoft’s Activision Blizzard acquisition deal worth $68.7 billion
The transaction requires regulatory approval from the UK, US, and EU in order to proceed. The CMA is the first of the three regulators to rule, so its judgment might thwart the entire takeover, making today’s ruling an especially crucial step in the procedure. The UK organization claimed it was indifferent about the contract distorting the competitive environment for console video games.
Martin Coleman, the head of an impartial group that looked at the regulator’s suggestion, however, said that it was crucial to safeguarding competition in the “emerging and exciting market” of cloud gaming.
As per the statements published: “Microsoft already accounts for an estimated 60-70% of global cloud gaming services and has other important strengths in cloud gaming from owning Xbox, the leading PC operating system (Windows), and a global cloud computing infrastructure (Azure and Xbox Cloud Gaming). The deal would reinforce Microsoft’s advantage in the market by giving it control over important gaming content such as Call of Duty, Overwatch, and World of Warcraft. The evidence available to the CMA indicates that, absent the merger, Activision would start providing games via cloud platforms in the foreseeable future.”
— Brad Smith (@BradSmi) April 26, 2023
The ruling is a setback to Microsoft’s intentions of acquiring Activision Blizzard, and if an appeal is rejected, it will probably prohibit the corporation from concluding its significant transaction. Microsoft in a statement said, “The CMA’s decision rejects a pragmatic path to address competition concerns and discourages technology innovation and investment in the UK.”
Right now, it’s unclear what this implies for the overall agreement as well as for franchises like Call of Duty and Overwatch. The future seems uncertain, but Microsoft and Activision are determined to work to appeal the decision.