Microsoft Now Feels Differently About CMA After Merger
Microsoft has recently adjusted its stance regarding the UK's Competition and Markets Authority (CMA), following a period of contention over the proposed acquisition of Activision Blizzard. Microsoft President Brad Smith, who had previously shown strong disapproval of the CMA's initial rejection of the deal, has now expressed recognition of the regulator's rigor and impartiality after the deal was restructured and received the CMA's green light.
Reported first by The Verge, Brad Smith's initial reaction to the CMA's actions in April 2023 was laced with disappointment. He labeled that time as the most challenging period for Microsoft in the United Kingdom, voicing apprehension over the impact on the country's business climate. Smith hinted that Microsoft might find a more hospitable environment for its business in the European Union, considering the situation at the time.
In October, with the amended terms of the acquisition accepted by the CMA, Smith's comments took on a more cooperative note. He reflected on the episode as a learning curve, intimating that on reflection, he might have expressed his previous concerns more cautiously.
The CMA exerted considerable influence in reshaping the deal, compelling Microsoft to give up crucial rights related to cloud gaming not only in the UK but in other markets as well. Smith gave due credit to the agency, stating that the CMA maintained a stringent benchmark that he came to respect, noting that, in his view, the approach was stringent yet equitable. He suggested that the CMA's resolute stance led Microsoft to alter its strategy regarding the acquisition, which was instrumental in securing its approval.
Despite Smith's revised viewpoint, the CMA has not overlooked Microsoft's initial confrontational approach. CMA CEO Sarah Cardell issued a warning to businesses, highlighting that Microsoft had opportunities to modify the deal during the initial examination. However, they persisted in advocating for a set of measures that the agency had indicated would not be effective.
In the wake of the disagreement and intense discussions, it appears Microsoft is now intent on repairing the somewhat strained rapport resulting from the resistance to the CMA's initial decision. The narrative surrounding the interaction between Microsoft and the CMA has been tumultuous, but there is relief that the matter seems to have reached a resolution.
