The Cloud Gaming market and CADE´s mismatch with the FTC and CMA

The Cloud Gaming market and CADE´s mismatch with the FTC and CMA

In April 2023 Microsoft lost another battle in its plans to consolidate its position in the cloud gaming market, through its platform for the Xbox gaming consoles. The acquisition of Activision Blizzard, the owner of famous gaming franchises such as Call of Duty, World of Warcraft, and Doom, by Microsoft makes up for a 69 billion dollars deal that suffered a recent turnover caused by the Competition and Markets Authority (CMA), the UK antitrust agency.

The British antitrust agency decided to block the deal, reasoning that the acquisition of Activision Blizzard by Microsoft would cause a substantial and harmful concentration in the cloud gaming industry, harming the UK consumer. CMA´s decision is subject to a court appeal by Microsoft, the court section is scheduled to the week of July 24th .

The outlooks of the operation don´t seem very promising in the USA jurisdiction either, given the fact that the FTC, US´s antitrust agency, also has spoken against the acquisition. A evidentiary hearing is scheduled for august 2nd . In the Brazilian jurisdiction the merger control was approved without any remedies, as well as in China, the European Union amongst other jurisdictions.

It is curious that the US and UK jurisdictions are the responsible for bringing a more thorough and hard analysis on such a merger, when it is usually the European Union that brings a harder approach on the use of antitrust law against the big tech companies. Perhaps what we are seeing is different approaches on facing big tech, UK and US are using the merger control tool whilst the EU is betting on repressive approach with inquiries and prosecuting anticompetitive conducts.

There is still a chance that de CMA is seeking to regain its protagonism in a post Brexit moment. The only certainty is that competition law firmly holds itself as the main stage in the fierce fight in-between governments and big techs.