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Microsoft Activision Blizzard Appeal: What Happens Next? -By Fsk

Microsoft has said it will appeal today’s shock decision by UK regulators to block its $68.7 billion Activision Blizzard acquisition – but how will it work, and can it still succeed?

Appealing against today’s decision will be a lengthy process for Microsoft, and will block any chance of a deal being approved globally for months – and it will be pending separately at the US Federal Trade Commission and the EU’s European Commission. Still without decisions, both are still investigating the deal for themselves.

“According to the Competition Appeal Tribunal site, direct cases have to be settled within nine months,” games industry analyst Piers Harding-Rolls told Eurogamer today. “If the appeal is successful it is returned to the CMA for review. This again will take some time.”

Newscast: Can Microsoft’s Activision Blizzard Appeal Succeed?

“I think the chances of the acquisition closing this year are substantially reduced. The next step is an EU decision on the deal in late May and FTC action in early August.”

Can Microsoft’s appeal be seen as a straightforward case? Given the deep concern expressed by the CMA in its final report today on the deal’s impact on the development of cloud gaming, it seems unlikely that the CMA will suddenly make a U-turn on its approach.

Harding-Rolls continued, “Recent news that the CMA has increased its focus of concern to the cloud gaming market is expected to drive deals following Microsoft’s suggested behavioral measures and very public deals with cloud gaming companies.” Will be approved.” “After all, streaming of sports is still quite nascent in the UK.

“This has not been the case. The CMA is more concerned about Microsoft’s cloud gaming capability in Azure, Windows and Xbox cloud gaming. The deals Microsoft has made with their respective cloud gaming services such as GeForce Now for Game Pass are not direct competitors. This is not enough to convince the CMA that it will prevent Microsoft from dominating the cloud gaming market in the future.”

In fact, the CMA’s report detailed its concerns that Microsoft’s current ownership of Xbox, Windows, and cloud infrastructure has already given the company dominance in the cloud gaming market. It has been said that being able to control franchises such as Call of Duty, Overwatch and World of Warcraft with a current advantage threatens any further competition in this space.

It’s also unclear how Microsoft can further appeal the issues raised by the CMA, given that it’s already considering proposed measures that didn’t go far enough. These include promises to largely keep Call of Duty available on other platforms, and 10-year deals with other cloud gaming services. But the CMA remained unconvinced that these would be sufficient.

Given the rapid changes in the budding cloud gaming market, the CMA said any such deals and promises cost Microsoft too much space down the line. The CMA also decided it did not want to enforce the decision over time – and the safer option was to block the deal.

Can Microsoft force CMA to admit it chose the easiest way out? Ultimately, any successful appeal will return the case to the CMA for re-evaluation.

“The appeal has a chance of success,” Harding-Rolls concluded, “but the CMA wins a significant majority of appeals made. If Microsoft wins, the case returns to the CMA for review.”

Earlier today, Activision Blizzard boss Bobby Kotick insisted that the CMA’s decision was “far from the final word” on whether the Microsoft deal would become a reality.