Microsoft spent the better part of last year trying to get its industry-breaking acquisition of Activision Blizzard for $68.7 billion approved. Now, after bypassing a dozen hurdles along the way, the deal has been blocked by the Competition and Markets Authority branch of the UK government, with the organization citing concerns for the future of cloud-based gaming as the main reason behind this motion.
The Xbox team has expended a lot of resources on this deal, and by now, the company’s outlook heavily depends on acquiring such major blockbusters as Call of Duty, World of Warcraft, Diablo, and even the extremely popular mobile game, Candy Crush Saga. But now that the CMA has moved to block this deal, the merger will be stopped dead in its tracks on a global level.
As for how Microsoft is dealing with this disastrous development, the company has a lot of assets in the UK, so its next move is to threaten the country and its future credibility in the tech space. During a recent chat with the BBC, vice chairman Brad Smith said that while Microsoft is “very disappointed” by this outcome, the greater concern should be for Britain.
“It does more than shake our confidence in the future of the opportunity to grow a technology business in Britain than we’ve ever confronted before,” he said. “People are shocked, people are disappointed, and people’s confidence in technology in the UK has been severely shaken. There’s a clear message here – the European Union is a more attractive place to start a business than the United Kingdom.”
There’s indeed a clear message here, and it’s that Microsoft is going to pressure the UK government into approving this deal one way or another. The CMA is standing its ground at the moment, but can it ultimately match the corporate power Microsoft will bring down to bear against its regulatory rules?
A spokesperson responded to Smith’s accusations by saying that these claims “are not borne out by the facts,” though it’s obvious the Xbox team is hoping that the subtler chimes of their harsh response get through to the powers that be.
