Microsoft’s Activision View In The UK Is Blocked By The Cloud, Not Consoles

(CTN News) – In the wake of Xbox versus PlayStation, Britain blocked Microsoft’s record acquisition of Activision Blizzard due to the nascent cloud market.

In order to satisfy concerns about the $69 billion deal raised by Britain’s Competition and Markets Authority (CMA), which has been increasingly proactive in taking on “Big Tech” after Brexit, Microsoft has been working hard for months to satisfy them.

As a result of the ruling, which the US company has vowed to appeal, a precedent is set for the European Commission, which is due to impose its own verdict next month, as well as the U.S. Federal Trade Commission.

It was announced today that Microsoft has offered Sony a 10-year guarantee that the latest versions of “Call of Duty” – one of the most valuable franchises in the gaming industry – will be available on the PlayStation at the same time as they are on the Xbox. An agreement similar to this was secured by Nintendo as well.

Those points only addressed the concerns of the CMA regarding consoles, leaving only cloud gaming as the remaining hurdle – and one that appears to be of a lower difficulty.

It is not easy to define the concept of cloud gaming.

The types of platforms and business models are still evolving, and several “gaming as a platform” services have struggled to succeed, such as Google Stadia, according to a submission made by UCL School of Management’s Joost Rietveld to the CMA’s inquiry on gaming platforms.

Are we talking about a transient Microsoft technology here?

It has been reported that Activision has not made its titles available via cloud services, calling them a “transitory technology”, while Microsoft, which offers an Xbox Game Pass service, has stated cloud gaming is “no more than a feature”.

According to the CMA, cloud gaming was the most rapidly growing sector in gaming, while consoles were a mature market.

According to its report, Microsoft controls 60-70% of global cloud gaming services and has other trump cards: Xbox, Windows, the leading PC operating system, and Azure, which provides cloud computing services.

In an agreement with Activision, Microsoft agreed to offer some Activision games on Nvidia, Boosteroid, and Ubitus cloud platforms.

However, the CMA argued that Microsoft’s remedies left out competing subscription models, such as Netflix for games, or providers who did not use Microsoft’s operating system.

As a result, (Microsoft’s) proposals did not effectively address our concerns and would have replaced competition with ineffective regulation in a new and dynamic market.

According to Ben Barringer, equity research analyst at Quilter Cheviot, UK regulators have taken an active stance against anti-competitive behavior ever since Brexit.

It is this stance that ultimately led to Microsoft’s decision to halt the purchase, as it believes Microsoft already has a dominant position in the cloud gaming space and ‘cloud gaming needs a free and competitive market in order to drive innovation and choice’.”

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