UK Antitrust Regulator Halts Microsoft-Activision Blizzard Deal, Citing Cloud Gaming Concerns

The UK's Competition and Markets Authority (CMA) has put a stop to Microsoft's $69 billion acquisition of Activision Blizzard, citing potential harm to cloud gaming competition. The regulator expressed concerns that the deal could lead to reduced innovation and choice for UK gamers.

The acquisition would bolster Microsoft's already dominant position in cloud gaming, where it holds a 60%-70% global market share. The news impacted Activision's shares, which fell more than 11%, while Microsoft's stock rose 8%.

As the producer of major games like "Call of Duty," "World of Warcraft," and "Overwatch," Activision Blizzard's merger with Microsoft has faced resistance from antitrust regulators worldwide. The US Federal Trade Commission filed a lawsuit to block the takeover last December, and the European Union is currently evaluating the transaction.

The CMA fears that Microsoft could make Activision's games exclusive to its own platforms and raise the cost of Game Pass subscriptions. Both Microsoft and Activision Blizzard plan to appeal the decision, but their chances of success may be limited due to the high bar for overturning such rulings.