Earlier this year, the gaming industry saw the biggest acquisition in history, as Microsoft entered into an agreement with Call of Duty maker Activision Blizzard for a whooping $69 billion. Now, nearly six months after the deal was announced, it has come under the scrutiny from UK’s antitrust watchdog, the CMA.
Competition and Markets Authority (CMA), the UK antitrust watchdog, has opened an investigation into the deal to consider whether it has led to “a substantial lessening of competition within any market or markets in the United Kingdom for goods or services”. It will also look to determine whether the deal will result in the formation of conditions such as higher prices or reduced choices on behalf of the consumers.
The Competition and Markets Authority (CMA) is known to be harsh and have an unforgiving stance when it comes to Big Tech. It has, in recent times, launched investigations against some of the biggest players such as Amazon, Google, and Meta in its pursuit to establish itself as a big player in the race to rein in Big Tech.
For now, it has until September 1 to make its Phase 1 decision on the same, which will see either the deal being given the green light and both companies free to move ahead with the deal. If not, then the CMA will move to a more in-depth Phase 2 probe. In the meantime, the CMA will work with its counterparts in other countries.
The deal between Microsoft and Activision Blizzard continues to be subject to customary closing conditions and is expected to close in the fiscal year 2023. Until then, both Activision Blizzard and Microsoft Gaming will continue to operate independently. If it is sealed, then Microsoft will be able to offer numerous Activision Blizzard games on their Xbox Game Pass and PC Game Pass.
For its part, Microsoft said that it would cooperate with the antitrust watchdog and answer the questions of regulators. “We remain confident the deal will close in the fiscal year 2023 as initially anticipated,” said Lisa Tanzi, Microsoft’s Corporate Vice President and general counsel.