According to the outfit, Microsoft’s proposed solution failed to effectively address its concerns in the cloud gaming sector. The regulator believes the deal would alter the future of the cloud gaming market and lead to “reduced innovation and less choice for United Kingdom gamers over the years to come.”

Microsoft proposed the acquisition of Activision Blizzard in January 2022, and the Competition and Markets Authority launched an in-depth review of the deal in September 2022. In February 2023, the outfit determined that the deal could make Microsoft an even stronger competitor in the cloud gaming sector and stifle competition.

“Microsoft already enjoys a powerful position and head start over other competitors in cloud gaming and this deal would strengthen that advantage giving it the ability to undermine new and innovative competitors,” said Martin Coleman, chair of the independent panel of experts conducting the Competition and Markets Authority’s investigation.

“Microsoft engaged constructively with us to try to address these issues and we are grateful for that, but their proposals were not effective to remedy our concerns and would have replaced competition with ineffective regulation in a new and dynamic market.

“Cloud gaming needs a free, competitive market to drive innovation and choice. That is best achieved by allowing the current competitive dynamics in cloud gaming to continue to do their job.”