Microsoft (MSFT.O) is appealing Britain’s decision to deny its $69 billion merger of “Call of Duty” creator Activision Blizzard (ATVI.O) over “fundamental errors” in its cloud gaming services evaluation.
In April, Britain’s anti-trust regulator, the Competition and Markets Authority (CMA), banned the merger, saying it could hinder cloud gaming competition.
Microsoft appealed the verdict to Britain’s Competition Appeal Tribunal (CAT) on Wednesday, and a summary of its arguments was published on Friday.
According to the summary, the CMA’s finding that the merger would substantially reduce competition in the U.K.’s cloud gaming industry was erroneous.
Microsoft will tell the Competition Appeal Tribunal that the CMA “made fundamental errors in its calculation and assessment of market share data for cloud gaming services by failing to take account of constraints from native gaming (whereby gamers access games installed on their devices through a digital download or physical disc).”
It challenged the CMA’s grasp of the cloud gaming market and the deal’s impact in five grounds for appeal.
Microsoft Corporate Vice President and Deputy General Counsel Rima Alaily called the CMA’s decision “flawed for multiple reasons, including its overestimation of the role of cloud streaming in the gaming market and our position in it, as well as its unwillingness to consider solutions that received overwhelming industry and public support.”
“We are confident in the strength of our appeal and the binding commitments we have made to increase competition and choice for players today and in the future.”
The Competition Appeals Tribunal judges CMA judgments on their merits. Thus Microsoft cannot seek new remedies.
Microsoft’s UK-like remedies were accepted by the E.U.’s competition authorities, who authorized the merger earlier this month.
Microsoft appealed the U.S. Federal Trade Commission’s decision to ban the purchase because it would reduce competition.
“We prohibited this deal as we had concerns that it would reduce innovation and choice in the U.K. cloud gaming market,” a CMA representative said on Friday.
