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Microsoft Sings a Different Tune: CMA Praised for Tough and Fair Activision Blizzard Scrutiny

After initially criticizing the UK’s Competition and Markets Authority (CMA) for blocking its $68.7 billion Activision Blizzard acquisition, Microsoft has adopted a surprisingly conciliatory tone. In a recent interview with BBC Radio 4 Today, Microsoft President Brad Smith acknowledged the CMA’s “tough but fair” approach, stating that the regulator’s scrutiny ultimately led to a better deal for both Microsoft and the gaming industry.

Key Highlights:

  • Microsoft softens stance on UK’s Competition and Markets Authority (CMA) after deal approval.
  • CMA’s strict scrutiny led to changes in Activision Blizzard acquisition, addressing cloud gaming concerns.
  • Microsoft President Brad Smith acknowledges CMA’s “tough but fair” approach, respecting its high standards.
  • Industry experts see this as a potential shift in Microsoft’s regulatory approach, prioritizing transparency and collaboration.

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CMA’s High Bar:

The CMA’s initial concerns centered around the potential for Microsoft to dominate the cloud gaming market by gaining exclusive control over popular Activision Blizzard titles like Call of Duty. To address these concerns, Microsoft agreed to concessions, including divesting certain Activision Blizzard cloud gaming rights in the UK and other key markets.

Shifting Gears:

Smith’s newfound respect for the CMA marks a significant shift from Microsoft’s earlier stance. Previously, the tech giant had accused the regulator of damaging investor confidence in the UK and questioned its commitment to fair competition. This change in tone suggests that Microsoft may be adopting a more collaborative approach with regulators in the future, prioritizing transparency and addressing concerns head-on.

Industry Implications:

This development could have significant implications for the gaming industry, particularly in the rapidly evolving cloud gaming landscape. Microsoft’s willingness to work with the CMA sets a precedent for future mergers and acquisitions, potentially encouraging other companies to engage in open dialogue with regulators to ensure fair market practices.

Beyond the Headlines:

The CMA’s scrutiny of the Activision Blizzard deal is not an isolated incident. Regulators around the world are increasingly concerned about the power and influence of tech giants, particularly in data-driven industries like gaming. Microsoft’s recent actions could be seen as a sign of the company’s willingness to adapt to this changing regulatory landscape.

Looking Ahead:

While the Activision Blizzard deal is now moving forward, the CMA’s actions have undoubtedly left a mark on the industry. Microsoft’s newfound respect for the regulator is a positive development, suggesting a potential shift towards a more collaborative approach to mergers and acquisitions. Whether this marks a lasting change in Microsoft’s regulatory strategy remains to be seen, but it certainly adds an interesting layer to the ongoing conversation about big tech and its impact on the gaming world.