Cloud Gaming's Impact on the Microsoft-ABK Deal: How Significant Will It Be?

The proposed acquisition of Activision Blizzard by Microsoft has hit a roadblock due to concerns over cloud gaming. Regulators are worried that Microsoft's ownership of Activision Blizzard could give it a dominant position in the cloud gaming market, potentially limiting competition and innovation. However, some analysts argue that cloud gaming is not a distinct market and that Microsoft's remedies, such as offering free licenses to players and cloud services, can ensure competition remains open. The question remains whether cloud gaming will become the primary way consumers access video games in the future. Analysts point out that cloud gaming is not new, with services like Gaikai and OnLive launching in the late 2000s, but it has struggled to gain traction. The ability to stream games is more expensive and technically challenging than streaming music or video, and the long-term commercial viability of cloud gaming has yet to be proven. While some analysts believe cloud gaming will become a significant avenue for accessing video games, others are less convinced, citing the technical limitations and the fact that gamers have a different relationship with their games compared to music or video streaming. The UK's Competition and Markets Authority and the European Commission have different opinions on the matter, with the CMA believing Microsoft's acquisition could harm competition and the EC thinking that Microsoft's remedies will ensure competition remains open. Ultimately, the future of cloud gaming and its potential to become the dominant form of game consumption remains uncertain, with many factors needing to align before it can become a mainstream method of playing video games.