Previously on the Activision Blizzard merger, the deal was approved by South Africa, though other regions are in stark opposition. Today, we'll focus on the decision made by one of such opposers with the UK Competition and Market's Authority. As this institution is the current branch that has motioned to ultimately shutter the deal.
There are two big reasons why this is even happening. First is a tweet that the CMA posted, revealing that they’re blocking the $69 billion merger on the basis of… cloud gaming. Certainly, an unexpected course of action considering that Sony’s barely touched the surface of cloud gaming, compared to Microsoft fully embracing the ideal. You can view the United Kingdom CMA’s tweet below.
We’ve prevented @Microsoft from purchasing @Activision over concerns the deal would damage competition in the #CloudGaming market, leading to less innovation and choice for UK #gamers. ☁️https://t.co/SdXt1rYAkZ pic.twitter.com/prWcDI7Evt
— Competition & Markets Authority (@CMAgovUK) April 26, 2023
So, cloud gaming is the straw that broke the camel’s back, as unbelievable as it sounds. Compared to the overall gaming industry, cloud gaming is around 1% of the entire industry. Secondly, and the probably far more realistic side of things, could have to do with the Nintendo Switch’s… less-than-stellar performance with their games. The CMA enters the picture here, and in their 418-page report on the acquisition, we can find the following remark:
CoD is currently available on two gaming consoles – Xbox and PlayStation. We found that these consoles compete closely with each other in terms of content, target audience, and console technology. We found that Nintendo's consoles compete less closely with either of Xbox or PlayStation, generally offering consoles with different technical specifications, and with its most popular titles tending to be more family- and child-friendly.
Nintendo does not currently offer CoD, and we have seen no evidence to suggest that its consoles would be technically capable of running a version of CoD that is similar to those in Xbox and PlayStation in terms of quality of gameplay and content.
Considering that 60 frames per second are on such a game-by-game basis for the Switch (and many games that run at 60 and above elsewhere are incapable of doing so on Switch), that’s a valid concern. However, it also is important to note that Microsoft did make a deal with Nintendo to bring Call of Duty to the Nintendo Switch. Not to mention, this kind of deal was made with cloud gaming services such as GeForce NOW, addressing the cloud gaming concern offered by the CMA.
Of course, it's easy to assume that Microsoft could basically make Cloud versions of Call of Duty games available on the Nintendo Switch. This isn't a new practice in the industry, as the hardware has been relying on this kind of game to be able to play games such as Hitman and Kingdom Hearts. In the meantime, we'll expectantly wait for more news regarding Microsoft's appeal of the Activision Blizzard block soon.
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