Microsoft dealt a major blow in the form of the UK blokes Activision buyout

In a dramatic twist that we’ve apparently never seen before, the UK’s Competition and Markets Authority (CMA) has blocked Microsoft’s acquisition of Activision Blizzard after months of investigation and deliberations.

Microsoft’s industry-shaking $69 billion purchase of the publisher giant has, predictably, been the subject of much discussion. After reports in March that the CMA was no longer concerned about the Microsoft deal – essentially saying it would have no negative impact on the industry – the block comes as a big surprise. In fact, analysts were fully expecting the CMA to give the green light to the Xbox maker today.

But here we are, Microsoft’s plans with CMA have suffered a significant setback. The Redmond-based company will, of course, appeal against the decision – but for a move that should have gone quite smoothly until a few minutes ago (at the time of writing this article), this is a real blow for Microsoft.

Here is the official order from the CMA, in tweet form:

Indeed, it seems the block has been created on behalf of cloud gaming concerns – another twist we didn’t see coming. The CMA’s report says: “Microsoft’s solution had significant shortcomings and will require regulatory oversight by the CMA.” It continues: “Cloud gaming needs a free, competitive market to drive innovation and choice.”

The CMA essentially argues that Microsoft already has a strong hold on the cloud gaming space, and the Activision Blizzard purchase would push its position too far, potentially harming competition and industry growth.

“Allowing Microsoft to take such a strong position in the cloud gaming market as it begins to grow rapidly would risk undermining the innovation critical to the growth of these opportunities,” it writes.

The acquisition of the tech giant is also being investigated by the US Federal Trade Commission and the European Commission of the European Union – neither of which has yet come to a definitive decision. It will be interesting to see whether the UK’s stance influences the thinking of these other institutions.

Naturally, it’s all positive news for PlayStation, as Sony has been fighting against the acquisition since its initial announcement, trying to persuade the likes of the CMA that a buyout would be unhealthy for the industry and consumers.

Did you see it coming? Pick your jaw up off the floor in the comments section below.