After a long ang lengthy investigation, the U.K.’s antitrust regulator, the Competition and Markets Authority, has announced that they will officially block Microsoft’s $69 billion purchase of Activision Blizzard. This was initially broken by Bloomberg’s Jason Schreier, who also detailed that Microsoft plans to appeal the decision immediately. The Committee states that they decided to block the deal after determining that it would “alter the future of the fast-growing cloud gaming market, leading to reduced innovation and less choice for UK gamers over the years to come.”
The Committee added that a proposed solution that Microsoft had made to them “had significant shortcomings and would require regulatory oversight by CMA.” The Committee continued by saying that Microsoft “has a strong position in cloud gaming services and the evidence available to the CMA showed that Microsoft would find it commercially beneficial to make Activision’s games exclusive to its own cloud gaming service.” The Committee adds to this with Microsoft’s huge presence in the cloud gaming service saying that they already have an “estimated 60-70% of global cloud gaming services.” These services include Xbox, Windows, and the Azure platform.
As we mentioned earlier, Microsoft has announced that they plan on appealing the decision. Microsoft President Brad Smith stated that “The CMA’s decision rejects a pragmatic path to address competition concerns and discourages technology innovation and investment in the United Kingdom.” He goes onto say that they have already signed many contracts to make all of Activison Blizzard’s future titles “available on 150 million more devices,” and called out the Committee’s decision as a “flawed understanding of this market and the way the relevant cloud technology actually works.”
Activison Blizzard themselves also chimed in with a much more up front and direct response. “The CMA’s report contradicts the ambitions of the UK to become an attractive country to build technology businesses,” they said. “The report’s conclusions are a disservice to UK citizens, who face increasingly dire economic prospects. We will reassess our growth plans for the UK. Global innovators large and small will take note that – despite all its rhetoric – the UK is clearly closed for business.”
Microsoft’s $69 billion purchase of Activision Blizzard has been contentious topic for well over year now. When the deal was made public in January 2022, it was shockwave that stunned the video game landscape and is still being felt to this day. It also started the very long and lengthy process for both companies to even get the deal approved in all markets and regions around the world. Their biggest hurdle by far has been the aforementioned Competition and Markets Authority, who has been going through a detailed and thorough investigation since June 2022. There’s no word on how long it’ll be before Microsoft’s appeal is heard, but either way, the company’s acquisition of Activision Blizzard has been stopped.