Microsoft’s $69bn Activision deal could hurt competition, UK says – Strategy – Cloud – Software

Britain’s antitrust regulator said Microsoft’s $69 billion acquisition of Call of Duty maker Activision Blizzard could harm competition in game consoles, subscription services and cloud gaming, and should be fully investigated.

The Competition and Markets Authority (CMA) said on Thursday that the deal, the largest in gaming history, could hurt the industry if Microsoft refuses to give competitors access to the latest games. sold from Activision.

“We are concerned that Microsoft could use its control over popular games like ‘Call of Duty’ and ‘World of Warcraft’ after the merger to harm rivals, including recent and future rivals in multi-game subscription services and online gaming. the cloud,” said the CMA. said.

Microsoft, with Xbox and rivals Sony and Nintendo, have led the console market for 20 years, with limited entry from new rivals, the CMA said.

“We want people to have more access to games, not less,” said Microsoft president and vice president Brad Smith.

“Sony, as an industry leader, says it’s concerned about ‘Call of Duty,’ but we’ve said we’re committed to making the same game available on the same day on both Xbox and PlayStation,” he said.

Several analysts described the move as unsurprising and said the deal would not be anti-competitive if competitors had access to Microsoft games, as Microsoft promised.

Microsoft needs to give more guarantees and put certain details about exclusivity in writing, said Kunaal Malde, an analyst at Atlantic Equities.

Activision still expects the deal to close in Microsoft’s financial year to the end of June 2023. The companies have until September 8 to submit proposals to address the CMA’s concerns.

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The deal, which was announced in January, will require approval in the United States, as well as other major jurisdictions, including the European Union and China.

Reuters previously reported that Microsoft would pay a $3 billion fee if the deal falls through, according to a source familiar with the matter, suggesting the company is confident of gaining antitrust approval.

The CMA said that Microsoft was well positioned to succeed in cloud gaming, given that it had a leading cloud platform in Azure and the leading PC operating system in the Windows operating system, as well as Xbox.

He said these strengths in combination with Activision’s games could hurt competition in the nascent market for cloud gaming services.

Microsoft said in a blog post on Thursday that it would release Activision’s top games on its Game Pass subscription service and also make them available to other consoles and mobile devices via cloud game streaming technology.

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