UK’s CMA Opens Probe into Microsoft’s Acquisition of Activision Blizzard

The $68.7 billion acquisition of American video game holding company Activision Blizzard Inc (NASDAQ: ATVI) by the tech giant, Microsoft Corporation (NASDAQ: MSFT) has now been flagged and undergoing a probe by the UK’s Competition and Markets Authority (CMA). As unveiled on Wednesday, the CMA said it has opened an investigation into the acquisition deal to determine whether it will hamper healthy competition in the United Kingdom.

This will be the first major probe the acquisition will be getting as fears abound that the control of crucial gaming franchises like Call of Duty, Candy Crush, and War of Warcraft will give Microsoft an undue advantage in the $190 billion gaming industry.

According to a released statement, the UK’s Competition and Markets Authority said its investigation would “consider whether the deal could harm competition and lead to worse outcomes for consumers – for example, through higher prices, lower quality, or reduced choice.”

The probe is in its first phase and a report on this is due on September 1 for an initial decision. Ahead of this decision, the CMA has called for public consultation and contributions from third parties who may wish to share information in line with the ongoing investigations. There are two probable decisions that the CMA can reach at this time, and this includes closing the probe, or to proceed to phase 2.

Anti-competitive deals are always flying around the corner and regulators are not sleeping on their oars in bringing violators to book. A few years back, the top tech firms in the United States including Meta Platforms Inc (NASDAQ: META), Apple Inc (NASDAQ: AAPL), Amazon.com Inc (NASDAQ: AMZN), and Alphabet Inc (NASDAQ: GOOGL) were grilled by the Antitrust committee of the House for various anti-competitive behaviors.

Echoing the UK’s CMA Competitive Concerns on Microsoft’s Activision Acquisition

The UK’s CMA anti-competitive concerns on Microsoft’s Activision Blizzard are generally echoed by industry stakeholders.

With the way Activision Blizzard’s gaming franchises are accessible to many gaming offshoots, experts believe at the time of the acquisition that Microsoft may monopolize these franchises.

“There is no doubt that this deal weakens Sony position in the market,” Piers Harding-Rolls, games research director at Ampere Analysis, said in a note published at the time. “Whether or not Activision Blizzard’s content is progressively made exclusive to Xbox platforms and services, inclusion of new releases into Xbox Game Pass for several major games franchises, including Call of Duty, will undermine Sony’s third-party business. Sony has benefitted from the ability to negotiate timed exclusive content for Call of Duty but this is now under threat.”

Irrespective of its leniency as the new owner of Activision Blizzard, Microsoft is bound to bolster its leverage in order to maximize profitability with the gaming franchises, all of which the CMA will be making a probe into.

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Benjamin Godfrey is a blockchain enthusiast and journalists who relish writing about the real life applications of blockchain technology and innovations to drive general acceptance and worldwide integration of the emerging technology. His desires to educate people about cryptocurrencies inspires his contributions to renowned blockchain based media and sites. Benjamin Godfrey is a lover of sports and agriculture.