The $69 billion acquisition of Activision Blizzard by Microsoft Corp. could hurt competition in gaming consoles, subscription services, and cloud gaming, according to Britain’s antitrust authority, who urged further investigation.
The largest gaming deal ever could harm the industry, according to the Competition and Markets Authority (CMA), if Microsoft forbids competitors from accessing Activision’s top-grossing games. According to the CMA, Microsoft, with Xbox, and its competitors Sony and Nintendo have dominated the console market for 20 years with few new competitors entering the market. It was unsurprising, according to a number of analysts, and the agreement wouldn’t be anti-competitive if rivals could play Microsoft games, as Microsoft has promised.
According to Atlantic Equities analyst Kunaal Malde, Microsoft needs to be more precise about exclusivity and provide more assurances.
Activision is still anticipating a closing within Microsoft’s fiscal year, which ends in June 2023. To resolve the CMA’s concerns, the corporations have until September 8 to submit their suggestions. The deal, which was unveiled in January, needs to receive clearance from the US as well as other important nations including the EU and China.
According to a source familiar with the situation, Reuters earlier reported that Microsoft would pay a $3 billion break-fee if the purchase fell through, indicating the business was confident in receiving antitrust approval. Microsoft, according to the CMA, is well-positioned to thrive in cloud gaming given its possession of Xbox, Azure, the top PC operating system, and Windows OS.
On Thursday, Microsoft said in a blog post that it will make popular Activision games available on its Game Pass subscription service as well as on other consoles and mobile devices using cloud game streaming technology.