Microsoft’s planned multibillion-dollar merger with gaming company Activision Blizzard could lead to higher prices, fewer choices or less innovation for UK gamers, the competition regulator said.
The $68.7bn (£56.7bn) deal could make Microsoft stronger, stifle competition and curb the rivalry between its Xbox console and the Sony PlayStation, according to a five-month study by the Competition and Markets Authority (CMA).
Among other things, Activision Blizzard is the producer of the popular video game series. Duty AND World of Warcraft How overexpected AND Diablo.
The regulator said the deal would bolster Microsoft’s strong position and “significantly reduce” the competition the US company would face in the UK gambling market.
The CMA has written to both companies asking them to propose a resolution to their findings, leading to their final decision in April.
Martin Coleman, CMA Research Lead, said: “There are an estimated 45 million gamers in the UK and people in the UK spend more on gaming than on any other form of entertainment.
“Intense competition between Xbox and PlayStation has dominated the console game market for the past 20 years.
“Our job is to ensure that gamers are not caught in the crossfire of global deals that, over time, could reduce competition and lead to higher prices, fewer choices, or less innovation. We have tentatively determined that this may be the case here.”
The deal will also be under scrutiny in the United States and Europe, as well as in the UK, where CMA 2021 showed its willingness to engage with Big Tech when it blocked Giphy’s takeover by Facebook owner Meta. The US Federal Trade Commission has also opposed the deal, and the case will go to court later this year.
The UK’s vital role in the gaming and entertainment business means official approval will be the key test that Microsoft and Activision around the world will require to close the deal.
Alex Haffner, a competition partner at law firm Fladgate, said that while the CMA’s decision was preliminary, it was noteworthy as the regulator suggested that companies giving up part of the business “may be the only option for merging parties.” “. . guarantee.”
Sony is lobbying regulators to oppose the deal, saying it was “bad for competition, bad for the gaming industry, and bad for gamers themselves” last year.
Mr. Huffner said that international regulators will be in close contact about the deal. “Therefore, it is clear that Microsoft faces a significant challenge to get a global green light for a deal on terms that it can economically meet.”
Microsoft has promised to keep Duty on the PlayStation. The popularity of the first-person shooter franchise has not waned nearly two decades since its launch, with the latest installment grossing $1 billion in its first 10 days last October.
Microsoft said it was buying the company too candy crush will drive its growth in mobile, PC, cloud gaming and consoles, allowing it to compete with the likes of Tencent and Sony.
Source: I News
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