The UK allowed Microsoft Activision to enter into a deal to replace tokens in cloud games

The UK has reversed its decision to buy Microsoft Activision, touting a trivial amendment to cloud gaming that it claims makes a big difference.

The UK now says Microsoft could buy Activision, but the latter's cloud gaming rights should instead go to independent firm Ubisoft.

“By selling Activision's cloud streaming rights to Ubisoft, We have become convinced that Microsoft will not be able to retain this important and rapidly growing market,” said Sarah Cardell, CEO of CMA. in the statement. “As cloud gaming grows, this intervention will provide people with more competitive prices, better services and more choice.”

“We are the only antitrust agency in the world to achieve this result,” she continued. “We have made it clear to Microsoft that the deal will be blocked unless they fully address our concerns and stand firm.”

Cardell also criticized Microsoft and warned that other companies should not imitate it. “[They] should be in no doubt that the tactics used by Microsoft are not the way to engage with the CMA.”

“Microsoft had the opportunity to restructure during our initial investigation, but instead they continued to push for a package that we told them simply wouldn't work,” she said. “Delaying proceedings in this manner only wastes time and money.”

However, by giving up cloud streaming rights to get the deal done, Microsoft actually lost a little — or nothing. Cloud gaming makes up a small percentage of the overall market, and while the CMA believes Microsoft can dominate, the company's share of cloud gaming is only limited.

The CMA did have other concerns with the deal as it identified “limited residual concerns”. However, the company has accepted “Microsoft's commitments to ensure compliance with the terms of the CMA's sale of Activision's rights to Ubisoft.”

Although the UK initially blocked the deal, the European Union approved it in May 2023. Other countries have also approved it, although the US Federal Trade Commission did try to argue that such a deal would be anti-competitive.


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