Microsoft Corp.’s planned $69 billion purchase of Activision Blizzard Inc. will be sent for an in-depth review unless it offers remedies to address the UK watchdog’s competition concerns.
The Competition and Markets Authority said Thursday it was concerned about a substantial lessening of competition in the gaming consoles, multi-game subscription services and cloud gaming services markets.
It gave Microsoft a September 8 deadline to offer acceptable remedies.
The combination with Activision -- which owns some of the most popular franchises including Call of Duty, World of Warcraft and Guitar Hero -- will make Microsoft the world’s third-largest gaming company and boost the XBox maker’s roster of titles for its Game Pass subscribers.
“We are concerned that Microsoft could use its control over popular games like Call of Duty and World of Warcraft post-merger to harm rivals, including recent and future rivals in multi-game subscription services and cloud gaming,” Sorcha O’Carroll, senior director of mergers at the CMA, said.
The British agency has taken a more forceful approach on recent deals, particularly by the biggest technology companies. Microsoft announced it was buying the Call of Duty maker in January in what was the biggest ever gaming industry deal.
“We’re ready to work with the CMA on next steps and address any of its concerns,” Brad Smith, Microsoft’s president and vice chair, said. “Sony, as the industry leader, says it is worried about Call of Duty, but we’ve said we are committed to making the same game available on the same day on both Xbox and PlayStation.”
The CMA joins other global regulators including the Federal Trade Commission in examining the deal and previously said it was working collaboratively to review the tie-up.
Regulators are likely to look closely at how Microsoft’s ownership of Activision could harm rivals by limiting their access to the company’s biggest games.