The United Kingdom’s competition watchdog launched a probe into Microsoft’s proposed acquisition of video game maker Activision Blizzard on Wednesday.
It is one of the first significant antitrust investigations into the $68.7 billion acquisition, which was announced in January.
The UK’s Competition and Markets Authority said in a statement that its inquiry would “examine whether the agreement could undermine competition and lead to worse outcomes for consumers, such as higher prices, inferior quality, or limited choice.”
The CMA has set a deadline of September 1 for its initial conclusion. The regulator stated that it wanted feedback from interested third parties, and that the consultation will be open until July 20, 2022.
There was no comment available on the issue from Microsoft.
The purchase has significant consequences for the $190 billion video gaming industry, as it gives one of the world’s largest software companies control of immensely lucrative properties such as Call of Duty, Candy Crush, and Warcraft.
Microsoft expects the acquisition will aid it in its pursuit of the so-called “metaverse,” a potential network of massive virtual worlds. Other businesses interested in the space include Facebook parent company Meta and Sony.
Analysts, on the other hand, are pessimistic such a merger will be allowed by regulators.
Microsoft, along with Sony and Nintendo, is one of the top gaming console manufacturers, and the firm is sitting on a huge trove of first-party content, including popular game franchises like The Elder Scrolls and Doom, which it acquired after purchasing Bethesda-owner Zenimax for $7.5 billion.
Meanwhile, Activision has been plagued by various internal troubles in the last year, including sexual harassment allegations, unionisation efforts, and employee walkouts.
Employees are dissatisfied with the company’s administration and have called for CEO Bobby Kotick to leave. Microsoft previously stated that Kotick will remain CEO of Activision until the transaction is completed.
(Adapted from Bloomberg.com)