Everything seems to be heading for Microsoft to win its first big battle to close the acquisition of Activision Blizzard. The UK Competition and Markets Authority (CMA) has just published an update on its investigation into the purchase, and has decided to “soften” its stance against the completion of the purchase. Because? Because they no longer believe that Microsoft wants to remove call of duty from playstation.
British regulators have decided to “narrow the scope of their concerns” around the deal. It is that the body now considers that the purchase of Activision Blizzard will not affect competition in the field of consoles. And he has described as unlikely a scenario in which the popular war shooter is no longer offered on Sony consoles.
But beware, this does not mean that the CMA has approved the transaction. The investigation is still ongoing and the date of next April 26 is maintained to announce whether the agreement is approved or not.
“The most significant new evidence provided to the CMA relates to Microsoft’s financial incentives to make Activision games, including call of duty, are exclusive to their own consoles. While the original CMA analysis indicated that this strategy would be profitable in most scenarios, the new data […] indicate that this strategy would generate significant losses in any plausible scenario. On this basis, the updated analysis now shows that it would not be commercially beneficial for Microsoft to have call of duty be exclusive to Xbox after the dealbut rather that Microsoft will still have the incentive to continue to make the game available on PlayStation,” the regulators stated.
Microsoft scores a small victory in the UK, led by call of duty
What the British CMA says ratifies the speech that those from Redmond have presented since day one: what to remove call of duty from PlayStation doesn’t make sense. Let’s not forget that Brad Smith, president of the American company, had already dismissed this possibility last December.
“The main potential anti-competitive risk posed by Sony is that Microsoft would stop offering call of duty on PlayStation. But that would be economically irrational. A vital part of the income of call of duty of Activision Blizzard comes from the sales of PlayStation games. Given the popularity of crossplayit would also be disastrous for the franchise call of duty and the Xbox itself, alienating millions of players, “the Microsoft executive had assured.
Therefore, the sayings of the CMA will surely be very celebrated in the offices of Phil Spencer and company. Although it is still far from a definitive victory. UK regulators still have one major concern to look at: The impact of the Activision Blizzard purchase on cloud gaming platforms.
martin coleman, who leads the panel of experts investigating the $68.7 billion purchase, was forceful about the announcement. “Our tentative view that this deal raises concerns in the cloud gaming market is not affected by today’s announcement. Our investigation is still ongoing to be completed by the end of April,” he explained.
Gaming platforms in the cloud, the concern to solve
That is to say, it is not entirely clear what is the concern around cloud gaming platforms. Certainly, one of the great goals of those from Redmond is to bring call of duty to Game Pass. However, his proposal for 10 years to Sony also includes the publication of future games in the series on PlayStation Plus from day one. To which is added the recent agreement with NVIDIA to bring the titles to GeForce Now.
Still, Microsoft appears to have cleared the biggest hurdle in its battle to buy Activision Blizzard. That is, to convince the regulators that you want to continue offering call of duty on PlayStation consoles. Having overcome said hurdle, largely established by complaints from Sony, the rest of the worries seem minor.
It remains to be seen if the CMA finally gives the transaction a thumbs up. If so, it will set an important precedent in this extensive soap opera. Let’s not forget that everything indicates that the European Commission will approve the agreement, but its definition has been delayed until May 22. If both agencies give the okay, all the pressure will shift to the American FTC.