UK Government Asks Public For Opinion On Microsoft-Activision Acquisition

The UK’s Competition and Markets Authority (CMA) has asked the public to share their opinions on Microsoft‘s proposed deal to acquire Activision Blizzard.

A post on the official UK government website detailed a step-by-step guide to how a Phase 2 merger investigation works. After carrying out an initial investigation, the authority might carry out a second phase if they feel “potential issues with competition” could arise as a result of the merger.

This involves gathering more information from Microsoft and Activision, the two merging businesses, to identify potential concerns from their merging.

The CMA has now published the findings of their investigation in an Issues Statement. The public will be able to respond with their opinions and evidence by emailing [email protected].

Image Credits | Gov.uk

Potential impact of the Microsoft-Activision Merger

The investigations carried out by the CMA will look into three major impacts of the merger. The first is whether it might affect the availability of Activision content and games on other consoles.

A full exclusivity deal would make Activision content available solely on Xbox and Microsoft platforms, whereas timed exclusivity would mean a delay in the content appearing on other consoles.

It could also lead to poorer quality of the same content on platforms, such as players not being able to access certain features or upgrades. Pricing could be an issue too, with Microsoft having the potential to raise Activision content prices on other platforms.

Another impact of the merger between Microsoft and Activision that the CMA is investigating are on multi-game subscriptions. These refer to competitor subscriptions to the Microsoft Xbox Game Pass, such as the PlayStation Plus. The CMA intends to make sure that the merger “won’t result in higher prices, lower quality, or reduced choice for gamers” who choose to use these subscriptions to access extra games and content.

Another concern is its negative impact on the future of cloud gaming, where gamers can stream games on the internet through a variety of different devices. The Phase 1 investigation has already found that Microsoft has pre-existing strengths: that it could use for cloud gaming.

They are one of the three major global gaming console providers on the market, and have a three-way stake in the cloud platform  Microsoft Azure, a cloud platform. In addition to this, they also own the operating system Windows OS.

The CMA intends to understand whether this merger with Activision’s gaming portfolio would combine their strengths, and give Microsoft the lion’s share in the cloud domain. It could also cause incentive or ability to harm rivals in cloud gaming.

CMA to publish their final report in March 2023

The CMA is now open to suggestions. Their website does state however that they may not be able to acknowledge and respond to all of the submissions because of the sheer volume of anticipated input.

Once they’ve analysed the evidence, the CMA will then publish their provisional findings along with possible solutions if there are issues found to have arisen. The body aims to publish the findings in January, at which point they will be open once again to public suggestion.

The CMA plans on publishing their final report on March 1. If there are no competition concerns found, then the merger can go ahead as planned. “If we do find competition concerns, we decide how these should be remedied,” the CMA states. “For example, this can include selling part of the business or prohibiting the merger altogether.”

The subject of the CMA’s investigation, Microsoft, has criticised its decision to expand its inquiry. They called the regulator’s concerns “misplaced”, and even took a dig at Sony, claiming that the body  “adopts Sony’s complaints without the appropriate level of critical review”.