has hit a massive roadblock in the UK. The country’s Competition and Markets Authority regulator on Wednesday announced it decided to block the Microsoft/Activision deal, saying the acquisition would hurt competition in the cloud gaming landscape. That’s a niche of the gaming ecosystem that Microsoft largely controls, according to the CMA’s investigation.
The CMA argues that Microsoft has a strong position in cloud gaming, according to the evidence available to the regulator. Moreover, the CMA found that “Microsoft would find it commercially beneficial to make Activision’s games exclusive to its own cloud gaming service.” The cloud allows UK gamers to avoid buying expensive gaming consoles and PCs and gives them much more flexibility and choice as to how they play. Allowing Microsoft to take such a strong position in the cloud gaming market just as it begins to grow rapidly would risk undermining the innovation that is crucial to the development of these opportunities.The CMA is the only regulator to block the deal so far, and Microsoft is likely to appeal this new decision.
The CMA also explained some of the shortcomings of Microsoft’s proposals to address cloud computing worries:
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