The proposed acquisition of Activision Blizzard by Microsoft has been rejected by the Competition and Markets Authority (CMA) of the United Kingdom on the grounds that it will hurt gamers and stunt innovation. To learn more about the deal’s possible market effects, the regulator conducted a five-month inquiry.
Based on the findings, the CMA said that the merger, “could make Microsoft even stronger in cloud gaming, stifling competition in this growing market and harming UK gamers who cannot afford expensive consoles.”
According to the authority, Microsoft currently controls 60–70% of the world’s gaming cloud services, thus the agreement—which would give them access to valuable mobile franchises like Candy Crush—will suppress the market’s competition. It also sparked criticism in regard to Call of Duty. The popular video game series has a strong brand recognition among gamers, and its most recent instalment (Call of Duty: Modern Warfare 2) generated $1 billion in sales in just 10 days.
According to the CMA, Microsoft may make the title exclusive to Xbox and PC or provide a subpar version of the game to rival PlayStation to increase its own sales. Microsoft has repeatedly affirmed its dedication to keeping Call of Duty cross-platform, even agreeing to a 10-year partnership with Nintendo to bring the title to their systems.
Sony, Microsoft’s competitor in the console market, has so far declined every offer made to them and is adamant about making things difficult for Microsoft.
“The CMA provisionally found that weakening competition by restricting the access that other platforms have to Activision’s games could substantially reduce the competition between Xbox and PlayStation in the UK, in turn harming UK gamers,” The CMA wrote in its findings.
The authority stated that, “reducing this competition between Microsoft and Sony could result in all gamers seeing higher prices, reduced range, lower quality, and worse service in gaming consoles over time.”
In a statement shared with Engadget, Microsoft’s corporate VP and deputy general counsel Rima Alaily said the company was committed, “to offering effective and easily enforceable solutions that address the CMA’s concerns.”
“Our commitment to grant long term 100 percent equal access to Call of Duty to Sony, Nintendo, Steam and others preserves the deal’s benefits to gamers and developers and increases competition in the market,” Alaily added.
