The British competition authority (CMA) has decided to block the $69 billion merger between online video game giants Microsoft and Activision Blizzard, citing the risks of excessive sector concentration that this mega operation induces in the United Kingdom. United. “This is not the decision we expected – but it is not the end of this operation,” writes Activision CEO Bobby Kotick. Microsoft and Activision will appeal the decision.
CMA says ‘concerns deal will change future of cloud gaming market’, a nascent but rapidly growing sector, ‘resulting in reduced innovation and less choice for UK gamers in years to come’ , according to a statement from the regulator on Wednesday.
Cloud gaming uses streaming technology to allow games to be played on any connected screen using a very high speed connection. The CMA fears that Microsoft is gaining a decisive competitive advantage in this market, and hindering the future development of competing services, thanks to its stranglehold on the catalog of Activision-Blizzard games.
The CMA had previously ruled out the risk that this takeover would represent for the video game console market, considering that Microsoft would have no economic interest in making Activision’s largest licenses exclusive to its Xbox console.
Microsoft and Activision immediately announced that they are appealing this decision. “We are particularly disappointed that after much deliberation, this decision appears to reflect a misunderstanding of this [cloud gaming] market and how the technology in question actually works,” Microsoft President Brad Smith said in a statement. communicated.
Activision for its part fired arrows against London. “The CMA report contradicts the UK’s ambitions to become an attractive country for the creation of technology companies. We will work vigorously with Microsoft to overturn this decision on appeal,” said a spokesperson for the video game publisher. “The report’s findings do a disservice to British citizens, who face an increasingly bleak economic outlook. We will reassess our growth plans for the UK. Global innovators big and small will also take note that, for all its rhetoric, the UK is clearly out of business.”
