The CMA’s ruling highlights concerns that the deal would give Microsoft an unfair advantage in the cloud gaming market, potentially leading to higher prices for consumers and a reduction in innovation.
Microsoft is already one of the leading players in the cloud gaming market. Its Xbox Game Pass subscription service boasts over 18 million subscribers.
Activision Blizzard, which is the world’s largest video game publisher, would add to Microsoft’s portfolio of popular gaming franchises, including Call of Duty, World of Warcraft, and Candy Crush.
The decision by the CMA is part of a wider trend of increasing scrutiny of tech mergers and acquisitions by regulators worldwide. Governments and competition authorities are becoming more cautious about allowing big tech firms to acquire smaller rivals.
The European Union, for example, has fined Google billions of euros for antitrust violations, and the US Department of Justice has sued Google and Facebook for alleged anticompetitive behavior.
CMA’s ruling is partially based on the idea that Microsoft will have pricing power due to its market dominance in cloud gaming. Experts are suggesting that if Microsoft is willing to keep pricing at $15 per month, plus inflation, the CMA may reverse its position.
