Microsoft Speaks On Leaving The Uk | Xbox Deal With Activision Update | Microsoft Leaving The Uk?

In a recent video update, Microsoft CEO Satya Nadella addressed the concerns surrounding the CMA's decision to block the Activision Blizzard merger. Nadella expressed his surprise and disbelief at their decision, stating that it goes against the fundamental logic of the deal. He emphasized that the acquisition would bring more competition and opportunities for publishers and gamers, making it a pro-competitive move.

Nadella believes that the deal would foster the growth of cloud gaming and enable other companies to prosper. He finds it puzzling that the CMA failed to recognize the potential benefits and consumer surplus that would result from the merger. He even went as far as laughing at their explanation, indicating his disagreement with their reasoning.

Microsoft's Willingness to Remove Games from the UK

The most interesting revelation from Nadella's response came when he was asked if Microsoft would consider removing their Activision games from the UK if the deal was not approved. Surprisingly, Nadella did not dismiss the possibility. This suggests that Microsoft is determined to see the merger through and is willing to take such measures if necessary.

While this might come as a shock to some, it demonstrates Microsoft's seriousness about the deal. The fact that the question was asked and Nadella did not outright reject the idea indicates that removing their games from the UK is indeed a possibility that Microsoft is considering.

Importance of EU Approval and Future Prospects

It should be noted that Nadella's response was given before the EU approved the merger. The EU's approval adds weight to Microsoft's case and makes the possibility of removing games from the UK more plausible. However, the situation is still subject to further developments, particularly with the FTC's decision.

Nadella expressed confidence that the deal would be approved by the FTC. In fact, he speculated that the case might not even go to trial and could instead be resolved through concessions. While the outcome is uncertain, it is evident that Microsoft is determined to overcome any obstacles in order to make the merger a reality.

The Clash Between the CMA and UK Government

The CMA's decision and the UK government's intentions seem to be at odds. The UK government aims to foster economic growth and become a hub for innovation, similar to Silicon Valley. However, the CMA's ruling goes against these goals.

Furthermore, the CMA's concerns regarding monopoly and lack of competition were addressed by the EU concessions. All cloud providers would receive a free license for Activision games, ensuring that competition thrives in this emerging market. Given the relatively low market share and low adoption rate of cloud gaming, it is difficult to argue that there is a monopoly on a service that is still in its infancy.

The Potential Outcome and Microsoft's Perspective

While the ultimate outcome of the merger is uncertain, it is encouraging to know that Microsoft has the option to remove their products from the UK if necessary. While it may not be a significant victory for Microsoft, as it would result in lost revenue, it does provide a potential resolution to the CMA blocking the deal.

Overall, the best possible outcome would be for the CMA to approve the merger, considering the potential benefits it would bring to the industry. However, if the UK continues to block the deal, there appears to be a pathway to see the merger through regardless.

Conclusion

The ongoing saga of the Activision Blizzard merger continues to captivate the gaming and business communities. Nadella's response to the CMA's decision sheds light on Microsoft's perspective and its determination to make the deal happen. With the EU's approval and the possibility of removing games from the UK, the path forward remains uncertain but full of potential twists and turns. It will be intriguing to see how the situation unfolds and what the ultimate fate of the merger will be.