UK competition watchdog clears Microsoft’s Activision Blizzard merger of threatening console competition
The United Kingdom is lowering its opposition to Microsoft’s acquisition of Activision Blizzard. The Competition and Markets Authority (CMA) updated its conclusions and concluded that the combination will not materially diminish competition in the console market. Despite the fact that the data remains the same, the watchdog now concludes that Microsoft’s ownership of properties such as Call of Duty will “not significantly damage” Sony’s ability to compete with PlayStation systems. According to the CMA, Microsoft may “degrade” the PlayStation’s attractiveness, but Sony’s platform has a robust enough portfolio that the harm would be limited.
The Authority also changed its previous belief that Microsoft would gain from excluding Call of Duty’s PlayStation audience. According to the CMA, more current Microsoft research reveals that making the game series Xbox-only or delivering exclusive privileges might result in significant losses in “any feasible scenario.” In other words, not enough gamers would transfer from PlayStation to Xbox for that approach to work.
The CMA states unequivocally that the additional results do not alleviate its worries regarding cloud gaming services. According to the regulator, Microsoft controls up to 70% of the global cloud gaming business, and finalising the Activision Blizzard acquisition might damage players who cannot buy an expensive console or Computer.
We’ve reached out to Microsoft and Sony for comment. Activision In a statement, Blizzard tells Engadget that the CMA now has a “better knowledge” of the console business, and that Microsoft has remedies in place for any lingering difficulties. Activision claims that Sony is just opposing the deal to “preserve its supremacy.”
Sony has long been hostile to the agreement, seeing it as a “threat to our business” that might harm the quality of Call of Duty on PlayStation. Microsoft has made a number of concessions in the hopes of completing the Activision Blizzard acquisition, including 10-year multi-platform commitments for Call of Duty and agreements to launch games on competing cloud platforms.
The UK overseer’s change of heart is insufficient to overcome opposition to the merger in other nations. The US Federal Trade Commission is still attempting to stop the union, pointing out that despite guarantees to European Union regulators, Microsoft made future releases like Redfall Xbox-exclusive on consoles. Those who disagree with the conclusions have until the end of March to submit their comments. Yet, Microsoft’s chances of completing the deal have improved since a major regulatory agency has abandoned its primary cause of concern.