Microsoft hits out at CMA for blocking Activision takeover

Microsoft hits out at CMA for blocking Activision takeover


Microsoft has reacted furiously to the UK’s Competition and Markets Authority (CMA) blocking its US$68.7 billion deal to buy gaming firm Activision.

In an interview with the BBC, Brad Smith, Microsoft’s president said yesterday was “probably the darkest day in our four decades in Britain”.

The decision stops Microsoft from acquiring several hit gaming titles including Call of Duty, world of Warcraft and Candy Crush.

"There's a clear message here - the European Union is a more attractive place to start a business than the United Kingdom,” Smith added.

Activision echoed the sentiments of Microsoft with a similar response.

"The CMA's report contradicts the ambitions of the UK to become an attractive country to build technology businesses," a spokesperson for Activision said.

While EU and US regulators are yet to make a decision on the deal, the CMA said in a statement that its ruling means that the takeover cannot continue globally as planned.

It said on the GOV.UK website that the deal could make Microsoft even stronger, thus stifling competition in a growing market.

Growing market

The UK cloud gaming market has seen users more than triple from the start of 2021 to the end of 2022. It is forecast to be worth £11 billion globally and £1 billion in the UK by 2026.

“Microsoft has a strong position in cloud gaming services and the evidence available to the CMA showed that Microsoft would find it commercially beneficial to make Activision’s games exclusive to its own cloud gaming service,” the CMA added.

Microsoft already accounts for an estimated 60-70% of global cloud gaming services.

“Gaming is the UK’s largest entertainment sector,” said Martin Coleman, chair of the independent panel of experts conducting the investigation.

“Cloud gaming is growing fast with the potential to change gaming by altering the way games are played, freeing people from the need to rely on expensive consoles and gaming PCs and giving them more choice over how and where they play games.”

“This means that it is vital that we protect competition in this emerging and exciting market.

Coleman added that cloud gaming needs a free, competitive market to drive innovation and choice. This, he says, is best achieved by allowing the current competitive dynamics in cloud gaming to continue to their job.

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