The UK’s Competition and Markets Authority provisionally found competition concerns on 8 February over Microsoft’s proposed US$68.7 billion acquisition of Activision Blizzard.
Photo: efes, 2015. Original photograph via Wikimedia Commons. CC0 1.0. Recompressed; responsive crops.
The regulator said control of games such as Call of Duty could weaken competition between Xbox and PlayStation. It also said Microsoft could benefit from keeping Activision games exclusive to its cloud service or giving rivals worse terms.
The CMA warned of possible higher prices, fewer choices and reduced innovation. Its findings aren’t a final decision.
The accompanying remedies notice shows what a workable sale might require. Options include the Call of Duty business, Activision alone, or Activision together with Blizzard. Prohibition is also under consideration.
A carve-out would need enough assets and resources to compete independently. The CMA’s initial view was that the suggested packages might fall short; it asked whether extra assets or staff would be needed. It also expected an identified buyer and a substantially completed divestiture before the merger could proceed.
A sale would therefore need to preserve a functioning competitor, including the people and resources behind its games.
The CMA is also seeking views on game-access commitments, despite its initial concerns about their effectiveness. Its notice identifies practical enforcement risks, including a company responding to price restrictions by lowering quality. It sees particular difficulty in designing durable rules for rapidly changing cloud-gaming business models.
Responses on possible remedies are due by 22 February and on the provisional findings by 1 March. The final report is due by 26 April.
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