Microsoft and the UK's CMA begin their appeal tribunal on July 24

Microsoft hopes to change the CMA’s mind regarding its acquisition of Activision Blizzard

Microsoft and the UK's CMA begin their appeal tribunal on July 24

Microsoft’s attempt to acquire Activision Blizzard has become one of the biggest evolving stories of the past few years,as regulators and competitors alike have attempted to scupper the deal. The UK’s Competition and Market Authority (CMA’s) decision in April to block the acquisition quickly proved to be the biggest hurdle so far, and one that Microsoft quickly announced it would appeal.

To this end, Microsoft quickly signalled its intent to appeal against the decision, and reports that the hearing will begin on July 24, and is expected to last for up to ten days.

The appeal will see the UK’s Competition Appeal Tribunal (CAT) review the case and the CMA’s decision to assess whether or not it made the right decision in blocking the acquisition. Notably several key territories, such as China, South Korea, and the EU have approved the deal, with the EU specifically highlighting proposed solutions by Microsoft to address its concerns regarding cloud gaming - the self same concerns that led to the CMA blocking the deal.

Microsoft has published a summary of its case breaking down the key points on which it believes the ruling should be challenged.

“The CMA’s decision is flawed for multiple reasons, including its overestimation of the role of cloud streaming in the gaming market and our position in it, as well as its unwillingness to consider solutions that received overwhelming industry and public support,” said Microsoft’s corporate vice president and deputy general counsel Rima Alaily.

“We are confident in the strength of our appeal and the binding commitments we have made to increase competition and choice for players today and in the future.”

Microsoft gets its day in court

Although Microsoft told the judges it wanted the hearings to take place as soon as possible, the CMA had pushed for a later court date to give it adequate time to prepare its case. It’s worth noting that the deal is due to be completed on July 18, so it’s likely that Microsoft were hoping for a court date prior to this. However, with the hearing with the FTC regarding the deal set for August 2, the deal would overshoot the contractual merger deadline regardless.

Is Activision Blizzard getting cold feet? That’s uncertain, but it’s worth noting that the company recently highlighted a clause in the contract allowing the deal to be abandoned should any government block it in a way that cannot be appealed. With two of the world’s major gaming markets standing in the deal’s way, missing the merger date could represent the opportune moment for either company to step away from the table.

Although Microsoft has refused to rule out a so-called mexit - removing Activision Blizzard titles from territories who fail to approve the merger - it’s unlikely that either Microsoft or Activision Blizzard would be willing to continue in this vein should both the UK and USA remain unconvinced. As such, a court date prior to July 18 may have gone a long way towards convincing any shareholders concerned about the possible revenue loss from such a move. Our group of industry experts recently gave their predictions on the future of the deal.

We listed Activision Blizzard as one of the top 50 mobile game makers of 2022.

Staff Writer

Lewis Rees is a journalist, author, and escape room enthusiast based in South Wales. He got his degree in Film and Video from the University of Glamorgan. He's been a gamer all his life.