The $69 billion Microsoft-Activision deal has been blocked by UK authorities due to concerns over cloud gaming.

$69 billion Microsoft-Activision deal has been blocked by UK authorities


UK regulators have halted Microsoft's proposed $69 billion acquisition of game business Activision because of worries about cloud gaming. Many people in the gaming industry were surprised by this choice, which has led to concerns about the future of cloud gaming. In this article, we'll look at the factors that led the UK to reject the deal and what that means for the gaming sector in this Tech Blog.

$69 billion Microsoft-Activision deal has been blocked by UK
$69 billion Microsoft-Activision deal has been blocked by UK

What is Cloud Gaming?

Cloud gaming is a technology that enables people to play games online without a physical console or device. Instead, games are hosted on distant servers, and video and audio are streamed to the player's device. The accessibility and convenience of this technology have helped it become more and more popular in recent years.

The Microsoft-Activision Deal:

Microsoft made plans to buy game giant Activision for $69 billion public in January 2022. The purchase, which would have given Microsoft control over some of the most well-known video game properties, including Call of Duty and Candy Crush, was anticipated to be the largest purchase in the gaming industry's history.

UK's Decision to Block the Deal:

The Microsoft-Activision merger was halted by the UK's Competition and Markets Authority (CMA) in March 2023. The CMA expressed worries about cloud gaming and its potential to affect the level of competition in the gaming sector. The CMA claims that the agreement would have given Microsoft an unfair advantage in the fast-expanding cloud gaming business, which is anticipated to develop over the next few years.

Implications for the Gaming Industry:

The UK blocked the Microsoft-Activision merger, which has significant implications for the gaming industry. The deal would have given Microsoft industry dominance, potentially stifling innovation and competition. The verdict also raises questions about the future of cloud gaming and its potential impacts on the industry. Despite the rise in popularity of cloud gaming in recent years, regulators may now pay it closer attention due to concerns about how it would affect innovation and competition.

In an attempt to bring the multi-billion dollar "Call of Duty" franchise to Nintendo's Switch, Microsoft had offered Sony - who had been opposing the deal - a 10-year license. However, the fate of the deal will now be decided by Europe, with a decision expected by May 22. The United States' Federal Trade Commission has also expressed its intention to block the deal.

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