|UK Government Blocks Microsoft's Proposed Activision Purchase
|Friday April 28 2023, @11:09AM
|from the dept.
In its long-awaited final report, the United Kingdom's Competition and Markets Authority said that Microsoft's proposed $69 billion acquisition of Activision would "result in a substantial lessening of competition" (SLC) in the supply of cloud-gaming services in the UK. As such, the regulator said that "the only effective remedy to this SLC and its adverse consequences is to prohibit the Merger."
The final report cites Microsoft's "strong position" in the cloud-gaming sector, where the company has an estimated 60 to 70 percent market share that makes it "already much stronger than its rivals." After purchasing Activision, the CMA says Microsoft "would find it commercially beneficial to make Activision's titles exclusive to its own cloud gaming service."
Microsoft has in recent months signed deals with Nvidia and smaller cloud-gaming providers in an attempt to "mak[e] even more clear to regulators that our acquisition of Activision Blizzard will make Call of Duty available on far more devices than before," as Microsoft Vice Chair and President Brad Smith said in a statement last month. But the CMA said these kinds of cloud-gaming deals—which Microsoft submitted to the CMA as a proposed remedy for any anticompetitive effects of the merger—were "limited to cloud gaming providers with specific business models" and thus not sufficient to address the regulator's concerns.
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Furious Microsoft boss says confidence in UK 'severely shaken':
Microsoft's president has attacked the UK after it was blocked from buying US gaming firm Activision, saying the EU was a better place to start a business.
The move was "bad for Britain" and marked Microsoft's "darkest day" in its four decades of working in the country, Brad Smith told the BBC.
The regulator hit back saying it had to do what's best for people, "not merging firms with commercial interests".
The UK's move means the multi-billion dollar deal cannot go ahead globally.
Although US and EU regulators have yet to decide on whether to approve the deal, the UK regulator the Competition and Markets Authority (CMA) said: "Activision is intertwined through different markets - it can't be separated for the UK. So this decision blocks the deal from happening globally."
If it had been approved, the $68.7bn (£55bn) deal would have been the gaming industry's biggest ever takeover, and would have seen Microsoft get hold of massively popular games titles such as Call of Duty, Candy Crush and World of Warcraft.
Original Submission #1 Original Submission #2
printed from SoylentNews, UK Government Blocks Microsoft's Proposed Activision Purchase on 2024-02-26 10:26:43