Microsoft’s $68.7 billion purchase of Activision Blizzard will have to gain approval from various regulators around the world before the deal can go through, including the UK’s Competition and Markets Authority (CMA). The CMA, which first announced its investigation in July, published a summary of its initial probe in September and recommended a more in-depth inquiry. As Ars Technica notes, a Phase 2 investigation could end up prohibiting a merger or requiring the entities involved to sell parts of a company. Now, shortly after the CMA published the full text (PDF) of its decision, Microsoft released a scathing response (PDF), accusing the regulator of relying “on self-serving statements by Sony.”
In its response that it has shared to Ars, the tech giant said the CMA’s decision was rooted in the concern that Activision’s catalogue of games, specifically the Call of Duty franchise, will allow Xbox to “foreclose its competitors.” Microsoft called that concern “misplaced,” arguing that the CMA is overstating the importance of Activision Blizzard’s games when it comes to competition in the space. It also said that it plans to make Call of Duty more accessible by adding Activision’s titles to its Game Pass subscription service.
Sony did not welcome the idea of this “increased competition,” the company said, stressing that its rival “protect[s] its revenues” by not making newly released games available through PlayStation Plus. Microsoft also said that there’s no basis for the idea that making Call of Duty available on Game Pass would make people more likely to buy an Xbox console. The company said CoD games would also be available for purchase on PlayStation and buying them would be cheaper than buying an Xbox for Game Pass access.
The CMA has adopted Sony’s complaints “without the appropriate level of critical review,” Microsoft continued. It added: “The suggestion that the incumbent market leader, with clear and enduring market power, could be foreclosed by the third largest provider as a result of losing access to one title is not credible.” Microsoft wrote in its response that it’s looking forward to working with the CMA through Phase 2, and it sounds like it’s determined to make the regulator understand the benefits of the deal.
As for Sony, a spokesperson repeated its stance in a statement sent to Reuters, calling the deal “bad for competition, bad for the gaming industry and bad for gamers themselves.” Microsoft’s acquisition would give the Xbox ecosystem “a unique combination of tech and content,” they said, which in turn would give the tech giant a dominant position in gaming that would have “devastating consequences for consumers, independent developers, and Sony itself.”
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