The United Kingdom’s Competition and Markets Authority (CMA) has confirmed that it has decided to block Microsoft’s $68.7 billion acquisition of Activision Blizzard. The CMA blocked the deal due to the possibility of consolidating power in the emerging cloud gaming market in which Microsoft is currently the market leader.
The CMA believes that this deal would make it more challenging for “emerging challengers” and that it would result in less innovation and choice for consumers. The CMA also took note of Microsoft’s proposed remedy for the concerns, which would have seen 10-year agreements with platform holders, but ultimately decided that it was not enough.
Brad Smith, vice chairman of Microsoft, has claimed that the company is disappointed with this decision and that the CMA has a flawed understanding of the video game market. He also confirmed that Microsoft is willing to make additional remedies to the 10-year agreements that would have made Call of Duty available to more than 150 million players. Despite this setback, Microsoft has confirmed that it is still committed to the acquisition.
The Federal Trade Commission, the regulatory board for the United States of America, has also announced that it will be taking action to block Microsoft’s acquisition of Activision Blizzard. Microsoft will have to pay Activision Blizzard between $2 to $3 billion if the acquisition fails to complete.
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