Microsoft’s planned $68.7 billion acquisition of video game publisher Activision Blizzard has been prohibited by Britain’s Competition and Markets Authority (CMA) in its final findings.
The proposed deal would’ve seen Microsoft acquire such hit franchises as “Call of Duty,” “Diablo,” “Warcraft” and “Candy Crush”. Earlier in the year, the regulator warned that the mega-deal “could harm U.K. gamers” and “substantially reduce” competition.
The UK regulator says its concerns are the deal would offer reduced innovation and less choice for gamers in the fast-growing cloud gaming business and that it was not concerned that the deal would distort competition in the console gaming market.
According to BBC News, an independent panel investigated the proposal for the regulator, and Microsoft’s submitted plans to address the CMA’s concerns were reportedly not effective. The panel’s chief Martin Coleman says competition in the blossoming cloud gaming sector is vital:
“Microsoft already enjoys a powerful position and head start over other competitors in cloud gaming, and this deal would strengthen that advantage giving it the ability to undermine new and innovative competitors.
Cloud gaming needs a free, competitive market to drive innovation and choice. That is best achieved by allowing the current competitive dynamics in cloud gaming to continue to do their job.”
In order for the acquisition to close, the deal has to be approved by regulatory bodies in the UK, United States and European Union. This was the first of the three regulators to rule, and the decision was seen as a vital one in order for the deal to close.
Microsoft says it will appeal against the decision.
