UK regulator blocks Microsoft’s $69 billion takeover of Activision Blizzard over cloud gaming issues

Britain to block Microsoft’s $69 billion (roughly Rs. largest gaming contract ever.

The country’s antitrust regulator said Wednesday that Microsoft’s commitment to offer access to Activision’s multi-billion dollar Call of Duty franchise to major cloud gaming platforms would not effectively address its concerns.

Microsoft said in a statement it remains fully committed to the acquisition and will appeal the decision, while Activision said it will “work aggressively” with Microsoft to reverse it.

“We will reassess our growth plans for the UK,” Activision said. “Global innovators big and small will take note that – for all its rhetoric – the UK is clearly out of business.”

Activision shares were down more than 10% in premarket trading in the United States.

The surprise decision comes after the Competition and Markets Authority (CMA) dropped concerns last month over the impact of the deal on the console market led by market leader Sony PlayStation.

That left cloud streaming services as the remaining hurdle, which Microsoft sought to overcome by signing licensing deals with streaming platform owners including Valve, Nvidia and Boosteroid.

Microsoft had previously offered Sony – a vocal opponent of the deal – a 10-year Call of Duty license, under a deal to bring the multi-billion dollar franchise to Nintendo’s Switch.

Europe will vote on the deal by May 22. The United States Federal Trade Commission is also seeking to block it.

© Thomson Reuters 2023

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