Just as it said, Microsoft has appealed the CMA’s decision to block its acquisition of Activision Blizzard, and its summary of the arguments is now available for scrutiny.
In April, after months of deliberation, the UK’s Competition and Markets Authority made the surprise decision to block Microsoft’s proposed $69 billion takeover of the Call of Duty maker, highlighting concerns about the burgeoning cloud gaming sector and arguing the deal would risk “suffocating competition in this region.” growing market.”
It is a position welcomed by some and rejected by others. The European Union, which agreed to the deal in May after Microsoft agreed to concessions, criticized the position of the Capital Markets Authority, and a number of politicians in the United Kingdom, including Chancellor Jeremy Hunt, also raised their concerns. Microsoft, of course, criticized the decision, confirming that it would launch an appeal.
This appeal would require Microsoft to submit its case to the UK Competition Court of Appeal, and a summary of its arguments is Available now for viewing. This outlines five main reasons Microsoft is challenging the decision, starting with its claim that the CMA made “fundamental errors in its assessment”. [Microsoft’s] The current position in cloud gaming services by not taking into account the limitations imposed by “local” games (i.e. where consumers play a game on their devices via a digital download or disc).
It also claims that the Capital Markets Authority “erred in not observing the three long-term trade agreements.” [Microsoft] entered into a conflict with cloud game providers”, calls the CMA’s conclusion that Activision would have made its games available on cloud gaming services without the merger “irrational and procedurally unfairly arrived at”, and argues the CMA’s conclusion that Microsoft would have “the ability and incentive to shut down its services”. competing cloud games by blocking access to Activision’s gaming content after an ‘illegal’ acquisition.
Finally, Microsoft maintains that the CMA “erred in the law by proceeding on the basis that it had a duty to impose what it called a blanket remedy”, “unlawfully failed to consider the interests of comity”, “erred in its refusal of Microsoft Cloud Remedy, and “violated [Microsoft’s] Duty to redress under common law and CMA compensation directives.”
Appealing the CMA’s decision is likely to be a lengthy process for Microsoft and Activision; The UK’s Competition Court of Appeal says it aims to deal with direct cases within nine months, and if the appeal is successful it will still need to be returned through the CMA for review.
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