I can understand why this decision has irked Microsoft the way it has. When the CMA put through their original objections they were able to counter those that were traditionally looked at using factual evidence. It’s almost impossible to counter projections decades into the future in a nascent market. No other regulator looks at these things because it’s nearly impossible to project things like this into the future without some sort of bias creeping into the equation. It’s going to be a huge issue for mergers and acquisitions as we’ve already seen in articles from lawyers, investors and companies popping up since the decision.
This is also the reason I think a straight appeal won’t work as even if Microsoft persuade the CTA the scenarios are unlikely it’s not going to be enough to get an approval.
The only route I see of success in the UK is through some form of political influence though I think it’s a difficult ask to get that done while staying on the straight and narrow. Large corporations like Apple, Microsoft, amazon and Alphabet have a long history of working directly with governments so it is a possibility but I wouldn’t bet on anything.
As for solutions to what the CMA complained about, they’re just impractical. As Microsoft said divestiture of Activision from ABK would result in quite large losses, xcloud can’t be seperated within Microsoft and it can’t be sold off because there’s nothing to sell without the gamepass subscription tied to it.
Suddenly the worse prime minister in recent British history (Sunak) is seen as the good guy… all because he’s sticking a fork in an American company. Moral of the story? The bigger a deal is (whether it’s a business deal or a political one between nations), the less facts, logic & justice have any influence whatsoever on the outcome.
There’s clearly some ulterior motivations at play here (obviously ‘stop big tech’) which means it’s borked as far as Britain is concerned under their current leadership. And considering the only alternative is Labour (even worse with business), the UK is now officially a problematic state for large companies like Microsoft.
I just read this and content doesn’t match the headline. I think the UK Gov are saying they disagreed that UK was a bad place to do business. I didn’t see anything in there about their thoughts on the deal though I might have missed it.
This has probably been discussed but the CMA based part of their decision on basically saying they don’t want to need to do any work. What if the EU passes with behavioural remedies that they will do the work on to monitor. Would that not change things?
I guess MS would still need to get far enough in process with CAT though to get the CMA to look again before they could use this.
Am I right in saying there are 5 possible scenarios here, am I missing any?
CAT agrees with CMA - most likely
CAT asks CMA to reconsider
CAT overturns CMA decision and passes deal
UK PM/Gov steps in and passes deal
EU blocks deal soon and MS walk away - least likely
The article is a bit misleading but if it is accurate that the UK government is siding with the CMA so quickly after the decision then it isn’t a great sign for Microsoft in their future endeavors in Europe. And I wouldn’t be surprised if Microsoft eventually moved their businesses out of Europe.
I just don’t see how they could side with them or even against them yet as they haven’t looked at the data. The CMA exists to do this for them.
I’m really not sure how it works at UK level but in Scotland a minister can step in and overturn a decision taken at a lower level. This happens most frequently with planning decisions.
So it might be the case that the minister that the CMA is under can do this or it might need PM but I’d guess they would need time to examine the evidence first.
Gonna be honest with you guys, Foss is using some weird, populist rethoric since the block was announced and I don’t think that kinda stuff is useful in here. Not really adding substance to the discussion.
Yeah, agree. Invoking fascism recently is a look I’m not going to agree with, as it derails the actual fascism the world is on the verge of in many countries. Populist rhetoric should be not allowed, and adds nothing to the discussion
They have devolved decision making to cma who are not political and independent. The government can only step in where it is a matter of national security or a health emergency.
Essentially they have created a system where the cma have the power. They’ve setup this idea of a tough regulatory system. It’s a weird one for the Tories to have done but they have.
I think he’s just rattled and flustered about it. He was fairly confident of CMA not blocking this for a while now and was not shy about sharing that notion for public consumption.
Sometimes my brother gets frustrated when he watches me play Battlefield because he is lethal at it and I just play for fun (i die a lot).
I can imagine Foss is aghast at the CMA for a thoroughly incompetent last 7 months resulting in a moronic decision on a flimsy reasoning and flawed math. The fact they had to drop the Console market SLC due to their own errors looked like the CMA was realising the deal for what it was. No problem.
Its been a farce since it started. “Nintendo doesn’t count” is something you’d read on a Playstation forum, not a regulators differential.
Yeah, this whole thing has been really weird since the beginning. I totally understand MS wanting to appeal, and I hope they succeed. Just think that the CMA moved to block the acquisition based on purely hypothetical scenarios. A this point, they could come up with anything they wanted if they don’t like someone. Blocking a deal should be based on facts, not theories.
MS seems really invested in ABK, more than any other in the past, I wouldn’t be suprised if they are thinking about some workarounds if the appeal doesn’t work.