The inquiry into Microsoft’s proposed acquisition of Activision Blizzard by the UK competition regulator has formally entered a second phase.
Due to specific regulatory concerns, the Competition and Markets Authority (CMA) stated last week that its probe into the $68.7 billion merger could be sent for an “in-depth review”.
Specifically, it expressed concern about the potential effects of the agreement on PlayStation’s capacity to compete, given that Microsoft would acquire control of the Call of Duty franchise as a result of the contract. The CMA said on Thursday that it had allowed Microsoft to submit ideas addressing its concerns, but the business had decided not to do so.
In phase two of its examination, the CMA appointed an impartial panel to examine the merger in greater detail and determine if it would significantly reduce competition.
The CMA has referred the anticipated acquisition by Microsoft Corporation of Activision Blizzard, Inc. for an in-depth investigation on the basis that, on the information currently available to it, it is or may be the case that this Merger may be expected to result in a substantial lessening of competition within a market or markets in the United Kingdom,”
In light of growing industry consolidation and worries about antitrust difficulties, regulators worldwide are closely examining the planned transaction.
Jim Ryan, CEO of Sony Interactive Entertainment, responded by labelling Microsoft’s plan for retaining the Call of Duty franchise on PlayStation systems “inadequate on many levels” and claiming that he wants access to all future Call of Duty games on equal terms and indefinitely.
When asked about its intentions for Call of Duty’s future, Microsoft clarified earlier this month. If the purchase is approved, Microsoft will continue to develop the game. Microsoft promised to keep the franchise accessible on PlayStation for “many more years” once Sony’s current marketing agreement with Activision ends, according to Xbox head Phil Spencer in a statement to The Verge.
With growing concerns regarding the acquisition deal, it is to be concluded that the agreement has become a controversy in the gaming industry. It will be interesting to see how Microsoft decides to pull this one off.