After months of deliberations, the UK will this week release its decision on Microsoft’s $68.7 billion attempt to buy Call of Duty publisher Activision Blizzard.
The UK’s Competition and Markets Authority (CMA) is one of three major regulators around the world still probing the Microsoft deal, along with the US Federal Trade Commission and the EU’s European Commission.
A final decision by the CMA should come before its deadline expires – this Wednesday, April 26 – and Microsoft has recently had reason to hope that its efforts to win over UK authority will ultimately prove successful.
Last month, the CMA issued its provisional findings on the deal, and said it now believed that Microsoft’s bid to take over Activision Blizzard “would not lead to a substantial reduction of competition in relation to console gaming in the UK”.
This marked a major change to the CMA’s attitude should the deal go through, after an earlier provisional report had raised significant concerns over the deal going ahead, and suggested such a deal could “harm UK gamers”. and warned of potentially resulting “higher prices”. less choice, or less innovation”.
In particular, the CMA was concerned with the possibility that Microsoft could limit PlayStation’s access to Call of Duty after the deal passed. Microsoft has always argued that doing so would not make business sense – that it would lose access to the lucrative market of PlayStation Call of Duty players, and that the game would suffer as a result. It’s an argument that Microsoft has now convinced the CMA.
“New data (which provides better insight into the actual purchasing behavior of Call of Duty gamers) indicates that this strategy would be significantly loss-making under any plausible scenario,” the CMA wrote last month.
That said, CMA’s last update wasn’t exactly clear. It was still considering the deal’s impact on cloud gaming services, and would continue to “carefully consider the responses provided”.
Sony reacted angrily to the development, describing the CMA’s recent soft stance as “surprising, unprecedented and irrational”.
Microsoft has ramped up its marketing budget to win hearts and minds around its Activision Blizzard deal passing. Earlier this year, Microsoft president Brad Smith made headlines when he signed a 10-year Call of Duty contract for the PlayStation, which he claimed to have in his pocket. Recently, Microsoft has been advertising its Activision acquisition on the London Tube.
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