Last week, the UK’s Competition Competition and Markets Authority announced it had provisionally concluded that the sale of Activision’s cloud gaming rights to Ubisoft substantially addresses its previous concerns regarding Microsoft’s takeover of Activision.

Just days before the CMA’s announcement leaked Microsoft documents showed the company seeks to make $1.4 billion from video game advertising by 2030. Insider Intelligence already estimates that Microsoft will net $9.8 billion in ad revenue this year. The addition of Activision’s user data will expand Microsoft's growing commercial surveillance apparatus well beyond the company’s current capabilities.

The following statement can be attributed to George Rakis, Executive Director for NextGen Competition (nextgencomp.tech):

It appears that Microsoft’s constant attacks on the UK regulator and its threats to hold its users as “ransom” to get what they want are on the verge of working. Microsoft’s agreement with Ubisoft to manage Activision’s cloud streaming rights for only 15 years does little to prevent the company from monopolizing cloud gaming, as many experts say that technology may not even reach maturity until the Ubisoft agreement expires. If the goal is to prevent Microsoft from monopolizing a nascent sector, this agreement may not even delay that outcome—let alone prevent it. The company's choice of Ubisoft is also no surprise since its frat boy and anti-union culture appears to mimic that of Activision Blizzard. It seems that Microsoft has a type.

And just days before the UK’s decision, Microsoft’s true surveillance ad network ambitions were leaked. We’ve long warned regulators that Microsoft’s acquisition of Activision-Blizzard would create a marketing goliath. Coupled with its previous acquisition of data-targeting platform Xander and the company’s growing interest in developing advanced ad products for use across platforms, a Microsoft-Activision merger further threatens user privacy and expands surveillance advertising.

This merger will further empower Microsoft to track and target its users across its current and proposed holdings, including Activision Blizzard titles. Microsoft's new alliance with Netflix, where it serves as the key ad and data service for the ad-supported streaming tier is a frightening example of how these advanced ad platforms will evolve. Activision's data on millions of consumers creates an even more powerful incentive for Microsoft to violate consumer privacy in the name of ad targeting—creating a highly anti-competitive force in the gaming marketplace.

We urge regulators in the UK and US to keep up the fight and not cave to Microsoft’s pressure campaign. Consumers, competition, and a healthy economy depend on it.

About NextGen Competition

Our mission is to support a robust and competitive technology ecosystem by opposing anti-competitive business practices and promoting greater industry accountability. Specifically, we oppose consolidation in the industry that undermines worker protections and employer accountability, threatens data privacy and security, encourages market concentration, and limits consumer choice. NextGen Competition intends to work with a broad coalition of unions and public interest partners as it seeks to oppose anti-competitive business practices.