The United Kingdom’s Competition and Markets Authority (CMA) confirmed on Wednesday that it has blocked the proposed purchase of Activision Blizzard by Microsoft, a deal valued at roughly 55,000 million pounds (about 62,163 million euros). The decision marks a significant intervention in one of the largest tech acquisitions of recent years and signals a strong stance on ensuring competitive markets in the gaming and cloud services sectors for the UK.
Martin Coleman, who leads the independent expert panel assisting the regulator, highlighted the CMA’s concerns over Microsoft’s position in cloud gaming. He noted that Microsoft already enjoys a substantial and advantageous footprint in cloud gaming services relative to other players in the market, and that the proposed agreement would likely fortify that edge by allowing Microsoft to outpace new entrants and innovators. The panel emphasized that the remedy measures proposed by Microsoft were insufficient to restore competitive balance in a rapidly evolving market.
Coleman stressed that cloud gaming requires a free and competitive market to spur innovation and provide consumers with real choices. The simplest path to achieving that outcome, he added, is to allow current competitive dynamics within cloud gaming to continue to work as they do, rather than substituting competition with regulation that may not keep pace with technology.
In response to the CMA’s ruling, a spokesperson for Activision Blizzard remarked that the CMA report conflicts with the UK’s goal of attracting tech businesses and suggested that the company would vigorously pursue an appeal with Microsoft. The spokesperson argued that the decision would not only affect the British citizens who benefit from a thriving tech ecosystem but also hinder the country’s economic prospects in the eyes of global innovators. He indicated that Activision Blizzard would reassess its growth plans in the UK and warned that, regardless of the rhetoric, the UK’s stance could be perceived as non-tradable by both large and small players worldwide.
Last month the CMA had given conditional clearance that would have allowed the American technology giant to complete the acquisition, but the regulator subsequently removed one of the key caveats after new evidence was reviewed. The CMA reasoned that the deal would not significantly lessen competition on gaming consoles once the impact of cloud gaming was taken into account, but new data and ongoing assessments led to a revised conclusion.
Despite those findings, the CMA’s ongoing analysis extended beyond traditional platforms and looked closely at how cloud services could reshape the competitive landscape for video games. This approach mirrors evolving scrutiny by other authorities across Europe and the United States, which continue to evaluate how cloud technology affects market structure, pricing, and innovation. The regulator’s decision underscores a broader trend toward proactive intervention in large tech consolidations seen as potentially consolidating access to critical distribution channels and customer data.
Observers note that the CMA’s ruling could act as a signal for Brussels and Washington to scrutinize similar deals with heightened scrutiny. The case highlights how cloud infrastructure and service ecosystems intersect with console and PC gaming markets, potentially influencing future mergers and regulatory responses. For developers, publishers, and platform operators, the decision emphasizes the importance of maintaining competitive pressures and avoiding arrangements that could stifle alternative offerings or deter new entrants from pursuing innovative business models in gaming and related cloud services.