A market regulator in the United Kingdom has concluded that Microsoft's $69 billion purchase of the video game developer behind Call of Duty would be bad for the U.K. marketplace, a step that could force Microsoft to break up the developer.
The Competition and Markets Authority announced on Wednesday it had provisionally concluded through its investigation of Microsoft's acquisition of Activision-Blizzard that the deal would stifle competition and lead to fewer choices, higher prices, and less market innovation. The CMA's conclusion arrives as Microsoft also faces pressure from regulators in the United States and the European Union over that same deal.
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"Our job is to make sure that U.K. gamers are not caught in the crossfire of global deals that, over time, could damage competition and result in higher prices, fewer choices, or less innovation," said Martin Coleman, the chairman of the panel of experts investigating Microsoft over the deal. "We have provisionally found that this may be the case here."
The agency proposed multiple remedies to resolve the potential monopoly, including divesting the Call of Duty franchise, splitting Activision from Blizzard, and even issuing an outright ban on the purchase.
"We are committed to offering effective and easily enforceable solutions that address the CMA's concerns. Our commitment to grant long term 100% equal access to Call of Duty to Sony, Nintendo, Steam, and others preserves the deal's benefits to gamers and developers and increases competition in the market," Rima Alaily, Microsoft's corporate vice president and deputy general counsel, said, according to Bloomberg.
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Activision-Blizzard was unfazed by the decision. "Steps from the E.C. and CMA are a normal part of their evaluation process. It opens the door to discuss various commitments Microsoft can make to assuage concerns as part of the ongoing dialog and engagement with regulators," CEO Bobby Kotick told employees in an email.
The U.K. is not the only country that is pressuring Microsoft over its conduct. The U.S.-based Federal Trade Commission also filed a suit against the software company to block the acquisition. The EU also issued an antitrust warning over the deal, threatening to investigate Microsoft if it continued.