Microsoft takeover of Activision Blizzard prompts UK regulator’s call

Microsoft takeover of Activision Blizzard prompts UK regulator’s call

San Francisco, Sept. 2, 2022

The Competition and Markets Authority (CMA).
has concerns about Microsoft’s roughly $69 billion acquisition of Call of Duty publisher Activision Blizzard. It has asked both companies numerous questions. They have five days to respond. If no suitable suggestions are made, the deal will be referred for a Phase 2 investigation, which will allow an independent panel of experts to look more closely at the risks.

Where does the agency come in?

The CMA warned that the proposed acquisition of the company, „could significantly reduce competition in gaming consoles, multigame subscription services and cloud gaming services.“ The CMA backed up this thesis by pointing out that Microsoft already had a leading game console (Xbox), a leading cloud platform (Azure) and the leading PC operating system (Windows OS). These are precisely the kinds of elements that could be important to success and failure in cloud gaming.

The two companies now have five working days to submit proposals to address the Commission’s concerns. If no suitable proposals are submitted, the deal will be referred for a Phase 2 investigation, which will allow an independent panel of experts to examine the risks in more detail.

„We are concerned that Microsoft could use its control of popular games such as Call of Duty and World of Warcraft post-merger to harm competitors, including current and future competitors in the multi-game subscription services and cloud gaming space,“ said Sorcha O’Carroll, senior director for mergers at the CMA.

Phil Spencer, Microsoft’s head of gaming, then promised that the company would follow a „principled path.“ He also added that Microsoft would “ make the same version of Call of Duty available on PlayStation on the same day the game launches elsewhere.“

In addition, Spencer promised, „We will continue to allow gamers to play together across platforms and devices. We know players will benefit from this approach because we did it with Minecraft, which continues to be available on multiple platforms and has expanded to even more platforms since [Minecraft developer] Mojang joined Microsoft in 2014.

At the same time, however, Spencer confirmed that Activision Blizzard games Overwatch, Diablo and Call of Duty will be included in Netflix’s Game Pass subscription service.