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Microsoft President says the UK was "tough and fair" when it first blocked Activision deal

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In April 2023, the UK Competition and Markets Authority blocked Microsoft's plan to buy Activision Blizzard, claiming such a deal would reduce competition in the small but growing cloud gaming space. At the time, Microsoft President Brad Smith did an interview for the BBC, stating the UK CMA's decision was "bad for Britain" and added, " . . . the European Union is a more attractive place to start a business than the United Kingdom."

However, Microsoft decided to make some changes to its Activision Blizzard deal, and that allowed the CMA to approve the agreement, and for Microsoft to finally close the purchase of the game publisher. Now, Smith said in a new interview with the BBC that the initial rejection of the deal might have been a good thing.

Smith now says the CMA was "tough and fair" when it first blocked the deal. He added:

It pushed Microsoft to change the acquisition that we had proposed, for Activision Blizzard to spin out certain rights that the CMA was concerned about with respect to cloud gaming.

Smith is referring to the fact that Microsoft is giving the cloud publishing rights of current and future Activision Blizzard games over to Ubisoft for the next 15 years. Smith stated that the approval of this revamped deal by the CMA "vindicated its position" and added, " I think that is good for everyone."

While Microsoft closed the deal to buy Activision Blizzard in the fall of 2023, the company is still dealing with the US Federal Trade Commission, which claims the acquisition is still "a threat to competition" in the video game industry. In December 2023, Microsoft and the FTC made their cases for and against the deal, respectively, to the United States Court of Appeals for the Ninth Circuit in San Francisco. It may be several months before we get a decision from the appeals court.

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