UK watchdog no longer thinks Microsoft’s Activision Blizzard merger is a threat to console competition (updated)

The UK is softening its objections to Microsoft's buyout of Activision Blizzard. The Competition and Markets Authority (CMA) has revised its findings and determined that the merger won't lead to significantly reduced competition in the console space. While the evidence remains the same, the watchdog now finds that Microsoft's ownership of franchises like Call of Duty would "not materially affect" Sony's ability to compete with PlayStation systems. Microsoft could "degrade" the PlayStation's appeal, the CMA says, but Sony's platform has a strong-enough catalog that the damage would be limited.

The Authority also reconsidered its view that Microsoft might benefit from shutting out Call of Duty's PlayStation audience. More recent Microsoft data suggests the company could suffer substantial losses in "any plausible scenario" by making the game franchise Xbox-only or offering exclusive perks, according to the CMA. Not enough gamers would switch from PlayStation to Xbox to make that strategy work, in other words.

The CMA makes clear that the updated findings don't change its concerns about cloud gaming services. In February, the regulator said Microsoft represented up to 70 percent of the worldwide cloud gaming market, and completing the Activision Blizzard purchase could harm gamers who can't afford an expensive console or PC.