Microsoft's Brad Smith Acknowledges Fairness Of UK Regulator CMA In Activision Blizzard Deal Approval

Microsoft’s President, Brad Smith, has lauded the UK’s Competition and Markets Authority (CMA) for its "fair" stance on the Activision Blizzard deal.

What Happened: Smith had previously criticized the CMA for blocking Microsoft Corp.'s MSFT acquisition of Activision Blizzard in a $69 billion deal.

However, after the deal was restructured and given the green light in the UK, Smith is now reflecting on the saga in a positive light in an interview with BBC's Radio 4 Today.

Smith referred to the initial obstruction of the $69 billion transaction as Microsoft’s “darkest day” in the UK and suggested the European Union was a more conducive environment for business.

However, following the CMA’s insistence on deal revision, Smith recognized the authority’s stringent and balanced approach.

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The firm stance of the CMA compelled Microsoft to amend its Activision Blizzard deal, leading to the relinquishment of considerable cloud gaming rights in the UK and other global markets. Smith conceded that the CMA’s strict standards forced Microsoft to modify its initial acquisition plan significantly.

The transaction was finally sealed in October after months of global regulatory scrutiny. Meanwhile, the FTC is still pursuing its case against Microsoft’s deal in the US.

Why It Matters: The CMA’s decision to initially block the deal in April 2023 was based on concerns that Microsoft could gain an unfair advantage in the cloud gaming industry. The regulator believed Microsoft could make Activision's games exclusive to its own cloud gaming service, which would be commercially beneficial for the company.

However, the deal was finally approved in October 2023 after Microsoft agreed to concessions to alleviate competition fears. The company secured the approval after agreeing to sell Activision's game streaming rights, including the popular "Call of Duty", to Ubisoft Entertainment.

Image Credits – Shutterstock

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