British CMA prevents Microsoft-Activision gaming deal

The British Competition and Markets Authority (CMA) has prevented Microsoft’s $68.7 billion deal to buy Activision, one of the most popular video games publishers in the world.

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The British Competition and Markets Authority (CMA) has prevented Microsoft’s $68.7 billion deal to buy Activision, one of the most popular video game publishers in the world. The CMA launched an in-depth review of the deal in September 2022. In February 2023, the Authority came to the provisional conclusion that the merger could harm competition in the growing cloud gaming market if Microsoft would gain more strength. The recent final decision follows Microsoft’s failure to propose an effective solution. According to Martin Coleman, chair of the panel of experts ‘Microsoft engaged constructively with us to try to address these issues and we are grateful for that, but their proposals were not effective to remedy our concerns and would have replaced competition with ineffective regulation in a new and dynamic market.’ The CMA found that allowing Microsoft to take such a strong position in the emerging cloud gaming market would risk undermining innovation and competitive dynamics. Whereas preventing the merger would allow market forces to continue to operate and shape the development of cloud gaming without regulatory intervention. The companies will reportedly appeal against the decision. Decisions of the US Federal Trade Commission and the European Commission on the merger are still pending.