UK regulators lend their support to business deal between Microsoft and Activision

Microsoft Corp.’s chances of winning antitrust approval for its $69 billion acquisition of Activision Blizzard Inc. increased after UK regulators narrowed the scope of their investigation to focus solely on cloud gaming.

The Competition and Markets Authority (CMA) said it changed its mind after weighing “a significant amount” of new evidence that Microsoft is unlikely to benefit from restricting access to the blockbuster Call of Duty franchise on rival consoles like Sony Corp’s PlayStation..

Pressure on Microsoft has intensified as it fights on multiple fronts in the United States and Europe to convince watchdogs to approve the deal, the company’s biggest and one of the 30 biggest acquisitions of all time.

The CMA’s initial position was that the merger could result in higher prices, less choice and less innovation for UK players.. He suggested a number of solutions, including selling Call of Duty from Activision or blocking the deal altogether. The agency said it would consider other alternatives that would protect rivals’ access to the hit game.

In its findings on Friday, the CMA concluded that, after reviewing more data, the strategy of selling Call of Duty “would not be profitable at all in any plausible scenario”.

The narrower focus of the investigation echoes a similar move at the European Union level, where the bloc is said to only focus on cloud gaming services.

“We appreciate the CMA’s rigorous and comprehensive review of the evidence and welcome its updated interim findings,” a Microsoft spokesperson said.

A spokesman for Sony, which has openly opposed the settlement in the CMA investigation, did not immediately respond to a request for comment.

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“Sony’s campaign to protect its dominance by blocking our merger cannot get past the facts, and Microsoft has already come up with effective and enforceable solutions to address each of the CMA’s remaining concerns,” an Activision spokesperson said. “We know this business will benefit competition, innovation and consumers in the UK.”

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