Following its blocking of the Microsoft Activision deal back in April, the CMA will soon have to fight its case against Xbox in a UK court.
Xbox ’s battle to get its $68.7 billion planned acquisition of Activision Blizzard approved rages on. It took an unexpected turn in late April when UK regulatory body the Competition and Markets Authority (CMA) rejected the Microsoft Activision deal on the grounds that Microsoft would have too much dominance in the cloud gaming space. This wasn’t enough to dissuade the tech giant from challenging the CMA’s decision, however, which we now know will occur as early as next month.
Microsoft’s appeal is set to be reviewed by the UK’s Competition Appeal Tribunal (CAT) at the end of July, in which it must try and convince CAT that the CMA was misunderstood in its decision. The details were expressed as part of a case management conference (as noted by an official CAT listing ) this week where judge Marcus Smith scheduled dates for the hearing. As per VGC, Smith said it “will take place in the fortnight commencing July 24, so the weeks commencing the 24th and 31st of July”.
According to Eurogamer, Microsoft had been pushing for a hearing period as short as four days, but the CAT pushed back and said it would take at least six. “There is a tendency—and it’s very much driven by the Tribunal rather than the parties—to cut submissions to shorter than they perhaps ought to be,” Smith said, before mentioning that he wanted both Microsoft and the CMA to have the appropriate amount of time to prepare their “oral submissions”.
Deal or no deal
In addition to having to fight the CMA in a UK court next month, the bigwigs at Xbox still have a big fight ahead of them in the form of a Federal Trade Commission (FTC) lawsuit in the US, too. Phil Spencer and co. did receive a touch of good news recently with EU regulators approving the deal, but the CMA only used this as another opportunity to reaffirm its point that it “could harm competition in the distribution of games via cloud game streaming services”.
All this tells me that the CMA remains confident in its original decision to block Microsoft’s deal, showing no sign of backing down despite Microsoft’s planned appeal in July. There’s a small chance that the CMA’s decision could be overturned, of course, but historically companies have a very low success rate in doing this.
Although the Microsoft Activision deal has been approved in well over 40 countries now, it’s still two points against Microsoft’s one out of the big three, as it’s still lacking support from the CMA in the UK and FTC in the US. The EU ruling can only help Microsoft’s case, but it isn’t the be all and end all. If the CMA’s decision is upheld by the judge next month, Xbox might find itself in the position where it has to operate slightly differently in the UK compared to other countries.
