The UK's Competition and Markets Authority (CMA) appears to have changed its tune towards the proposed Microsoft-Activision Blizzard merger. Though the CMA had previously expressed concerns that the deal could weaken competition, a new report now says the authority has "updated its provisional findings", leaning more in favor of Microsoft.
Back in February, the CMA declared that a Microsoft-Activision deal could "harm UK gamers" due to potentially leading to "higher prices, fewer choices, or less innovation" in cloud gaming and console gaming. Now, however, the CMA has issued a new report in which it seems to back down somewhat, at least when it comes to console gaming.
In the new report, the CMA says that it has received "a significant amount of new evidence" since its original provisional report. Taking that new evidence into account, the CMA says the transaction - i.e. the Microsoft-ABK merger - "will not result in a substantial lessening of competition in relation to console gaming in the UK".
Bear in mind there are a lot of uses of the word "provisional" in this report; this doesn't constitute the CMA's final findings. Those, according to the CMA, are still on track for the end of April, when we'll also get a decision regarding whether or not the potential merger would affect competition in the cloud gaming sector.
Though the CMA's beef wasn't solely with Call of Duty, that franchise has been at the core of a lot of authority and government concerns about a potential Microsoft-Activision Blizzard merger. The concern is that Call of Duty, a major moneyspinner for both Xbox and PlayStation, could become Xbox-exclusive, which would significantly restrict competition.
Microsoft has repeatedly denied that this would be the case, going so far as to sign a 10-year deal with Nintendo over the franchise as well as offering a deal along the same lines to Sony. Of course, Sony has objected, likely not wanting to be beholden to a Microsoft contract that the company could rescind or fail to renew at any time. Microsoft appears to be showing every willingness to co-operate with other console manufacturers, however.
Interestingly, it's Call of Duty that has prompted a change of heart from the CMA as well. The authority says that although it believed making Call of Duty Xbox-exclusive would be "profitable under most scenarios", examining new data that "provides better insight into the actual purchasing behavior of CoD gamers" suggests that exclusivity would lead to losses for Microsoft "under any plausible scenario".
It's worth remembering that the CMA's decision only relates to console gaming, and that the authority is "continuing to carefully consider" how cloud gaming would be affected under a potential Microsoft-Activision Blizzard scenario. It seems, though, that the UK authority, at least, has backed down regarding Call of Duty and the potential impact of exclusivity on competition. Watch this space for more info.
