The CMA’s provisional findings narrow the scope of their concerns over the Microsoft-Activision merger.
As we reported earlier in the year, the CMA or Competition & Markets Authority, the regulatory authority in the UK that investigates mergers and competition, found in its early provisional investigation that certain aspects of the merger might hurt competition in the gaming industry. Today, they’ve updated the public on their investigation, stating that making the highly-popular Call of Duty a Microsoft/Xbox exclusive would be “significantly loss-making under any plausible scenario.”
While these findings are still ongoing, with a full report scheduled to release on April 26, 2023, it is one less hurdle that Microsoft and Activision will have to clear before getting the green light from the UK regulator. However, it is important to note that while they’ve dropped CoD as a point of contention, they are still investigating claims that the merger may harm competition in cloud gaming.
FTC Complaint Still Ongoing
In addition to getting approval from UK regulators, Microsoft and Blizzard are also dealing with US regulators, the FTC, or Federal Trade Commission. According to the FTC complaint,
“The agency alleges that the deal would enable Microsoft to suppress competitors to its Xbox gaming consoles and its rapidly growing subscription and cloud-gaming business.”
These concerns echo the concerns of the CMA, as dominance in the cloud-gaming space is something both regulators are eyeing closely.
Ultimately, this news means Microsoft and Activision have eased the concerns of one of the two main issues in the early provisional findings for the CMA. That being said, it was one of the concerns that Microsoft Activision was trying to tackle publically with a 10-year agreement to bring CoD to other platforms, including Nintendo consoles. Still, it does not mean the merger is a sure thing yet, and we’ll have to wait for the full findings to be released by the CMA next month.
We’ll be following this story in our News Section.