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The UK Competition and Markets Authority (CMA) tentatively concluded that Microsoft's proposed acquisition of Activision Blizzard would not result in a material decrease in competition in console gaming services, as Microsoft would suffer financial losses if you removed Call of Duty from PlayStation. The regulator had previously concluded that a strategy by Microsoft to remove Call of Duty from the PlayStation would be profitable, which Microsoft had criticized for faulty financial modelling. The regulator now admits that Microsoft would suffer financial loss if it removed Call of Duty from the PlayStation. The regulator's investigation into the deal's impact on the cloud gaming market is ongoing, to which Microsoft is still subject. Microsoft's deal with Activision Blizzard has been under regulatory scrutiny in several countries due to concerns about its impact on the gaming industry Sony, one of the few opponents of the Microsoft deal, expressed concern about the future of Call of Duty and also filed a complaint. with CMA.
The CMA had to change its financial model, which compared gains from five years to losses from just one year, after Microsoft argued that the model had "glaring flaws" that ultimately skewed the results.
Microsoft has offered Sony a 10-year contract on Call of Duty, but the PlayStation maker has yet to sign off on the license. Sony may have waited for the deal to stall, as Sony's PlayStation boss Jim Ryan has reportedly made it clear that the company isn't interested in a deal with Microsoft. Although AMC's decision has allayed a key concern about Call of Duty, the investigation into the deal's impact on the cloud gaming market remains on track to be completed by the end of April.
Activision Blizzard responded to the CMA's announcement, saying that Sony's campaign to protect its dominance by blocking its merger cannot outweigh the facts, and Microsoft has already filed effective and enforceable remedies to address each of the CMA's remaining concerns. The deal is expected to benefit competition, innovation and consumers in the UK.
