April 20, 2024

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CMA Says Microsoft’s Acquisition of Activision Blizzard “Won’t Significantly Reduce Competition”

CMA Says Microsoft’s Acquisition of Activision Blizzard “Won’t Significantly Reduce Competition”

to update: Microsoft issued a statement in response to the CMA’s provisional finding.

“We appreciate the CMA’s careful and comprehensive evaluation of the evidence and welcome its updated interim results,” a Microsoft spokesperson told Eurogamer. “This deal will provide players more choice in how they play Call of Duty and their favorite games. We look forward to working with CMA to resolve any outstanding concerns.”

Original story: The UK Competition and Markets Authority has interimly concluded that Microsoft’s bid to acquire Activision Blizzard “will not significantly reduce competition in terms of console gaming in the UK”.

CMA has today Update its interim results Based on new evidence in response to these findings, the main one relates to financial incentives for Microsoft to make Activision games (including Call of Duty) exclusives.

“While the CMA’s original analysis indicated that this strategy would be profitable under most scenarios, the new data (which provides better insight into the actual buying behavior of CoD players) indicates that this strategy would result in significant loss under any plausible scenario.” New from the Capital Markets Authority.

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On that basis, the updated analysis now shows that it would not be commercially beneficial for Microsoft to make CoD exclusive to Xbox after the deal, but that Microsoft would instead have an incentive to continue making the game available on PlayStation.

The CMA’s addition to its interim results relates only to controller competition and not to cloud gaming services, while continuing to “carefully consider the responses submitted.”

“After considering the additional evidence presented, we have now tentatively concluded that a merger would not significantly reduce competition in console game services because the cost to Microsoft of blocking Call of Duty from PlayStation would outweigh any gains from taking such action,” said Martin Coleman, Chairman of the independent panel of experts conducting this investigation.

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The Capital Markets Authority is scheduled to announce its final decision on the acquisition on April 26.

Nevertheless, this progress is a huge step forward in the investigation and a positive conclusion for Microsoft.