CMA warns Microsoft-Activision merger could harm UK gaming market
The UK's Competition and Markets Authority has published provisional findings suggesting Microsoft's $68.7bn takeover of Activision Blizzard could damage competition in the gaming sector. The regulator warned the deal may lead to higher prices, reduced choice, and less innovation for UK gamers. Microsoft has pushed back against the concerns, pledging to offer equal access to key titles.
Microsoft's proposed $68.7bn (£56.7bn) acquisition of Activision Blizzard has run into serious regulatory opposition in the UK, after the Competition and Markets Authority released its provisional findings from a five-month investigation into the deal.
The CMA concluded that the merger could result in higher prices, fewer choices, and less innovation for the approximately 45 million gamers in the UK — a group that collectively spends more on gaming than on any other form of entertainment, including music, movies, television, and books. The watchdog determined that absorbing one of the world's largest and most recognizable game publishers would significantly reinforce Microsoft's position in the market, reducing competitive pressure the company would otherwise face.
Among the key concerns raised was the potential impact on the longstanding rivalry between Microsoft's Xbox and Sony's PlayStation, a competition that has shaped the console gaming market for over two decades. Opponents of the merger, including Microsoft's rivals, argued that the deal could restrict access to Activision's hugely popular Call of Duty franchise, though Microsoft has consistently denied such intentions.
Activision, headquartered in California, is one of the biggest names in gaming and esports, with a portfolio that includes well-known titles such as Call of Duty, Crash Bandicoot, Tony Hawk, and Skylanders. The company's prominence in the industry is central to the CMA's concerns about how its absorption into Microsoft could affect market dynamics and emerging areas such as cloud gaming.
Martin Coleman, chair of the independent expert panel overseeing the investigation, noted that new developments in cloud gaming are already expanding choice for gamers, and that preserving strong competition in the sector remains a priority.
Following the provisional findings, the CMA confirmed it has contacted the parties involved with a notice outlining possible remedies to address its concerns, requesting a response by February 22. The regulator's full report is expected to be published on April 26.
Microsoft responded by reaffirming its commitment to finding workable solutions to satisfy the CMA's concerns. Rima Alaily, the company's corporate vice president and deputy general counsel, emphasized Microsoft's pledge to provide long-term, 100 percent equal access to Call of Duty for platforms including Sony, Nintendo, and Steam. Microsoft also pointed to its public consultation results, in which three-quarters of respondents indicated they believed the deal would benefit competition in the UK gaming market.