Strange times for Microsoft. The $69 billion acquisition of Activision Blizzard by Microsoft has been halted by the UK’s antitrust watchdog because of fears that it will hinder competition in the cloud gaming market. But could that be necessarily the case? Apparently, yes. In a statement released on Wednesday (April 26), the Competition and Markets Authority expressed concern that the acquisition would somehow result in “reduced innovation and less choice for UK gamers over the years to come.”
The Competition and Markets Authority stated:
The cloud allows UK gamers to avoid buying expensive gaming consoles and PCs and gives them much more flexibility and choice as to how they play. Allowing Microsoft to take such a strong position in the cloud gaming market just as it begins to grow rapidly would risk undermining the innovation that is crucial to the development of these opportunities.
What would that mean for Microsoft, though?! Well, the purchase would make Microsoft even more powerful in the market for cloud gaming. Currently, the company has a 60%–70% global market share.
Both Microsoft and Activision intend to challenge the judgment.
What are your thoughts about Microsoft’s recent ‘issue?’
One of the greatest video game studios in the world, Activision Blizzard came up with the best titles so far, including Call of Duty, Overwatch, World of Warcraft, and Diablo. And there’s the Xbox Game Pass, which is a video game subscription service offered by Microsoft where the Xbox gaming system is sold, along with a cloud-based video game streaming service.
So, you can understand what Microsoft would get after the Activision Blizzard takeover. It’s a lot of power…in gaming!
But, the Competition and Markets Authority warned that Microsoft would try to make Activision’s titles exclusive to its own platforms before raising the price of a Game Pass subscription. Could that be the case?!
As a matter of fact, the UK cloud gaming business may be valued at up to £1 billion (around $1.2 billion) only by 2026, or around 9% of the whole market.