Microsoft has submitted a final report to the UK’s Competition and Markets Authority (CMA) as part of its efforts to persuade the watchdog to reverse its block on Microsoft’s plan to acquire Activision Blizzard.
While the US Federal Trade Commission (FTC) lost its anti-trust case against Microsoft, the CMA in the UK halted the deal, prompting Microsoft’s appeal in May. The submission to the regulatory body highlights Microsoft’s legal victory in the US court, the European Union’s approval of the acquisition, and its agreement with Sony to offer Activision games on PlayStation for at least a decade.
Considering the EU’s approval of the deal came with significant conditions regarding cloud gaming, Microsoft has mirrored this approach in its report to the CMA. The submission emphasizes Microsoft’s commitment to “legally binding ten-year obligations” to provide royalty-free worldwide licenses to NVIDIA, Boosteroid, and Ubitus for cloud gaming. It further highlights that Microsoft cannot modify or break these agreements without the consent of the European Commission.
The CMA’s initial concern centered around Microsoft potentially gaining a monopoly in the cloud gaming market. Microsoft’s report aims to alleviate these concerns by showcasing its contractual commitments and restrictions, thus attempting to put the UK government at ease. The fear was that the acquisition of Activision Blizzard would lead to a dominant player with a significant market share in the fast-growing cloud gaming space, which could hinder competition and consumer choice.
Microsoft’s tailored report seeks to address this specific apprehension raised by the CMA. While the outcome remains uncertain, it is unlikely that the CMA will hold out against international precedents. The hope is that the safeguards secured by the European Commission will adequately protect consumers, and the acquisition will proceed with the necessary caveats in place.
