Microsoft President Reevaluates UK Criticism Following Regulatory Approval

In a significant turnaround, Microsoft’s President, Brad Smith, has shifted his stance on the UK’s business environment after facing criticism for labeling it “bad for business” last year. The change in perspective comes in the wake of the Competition and Markets Authority’s (CMA) approval of Microsoft’s planned acquisition of gaming giant Activision Blizzard.

Previously expressing concerns over the rejection of the takeover bid, Smith acknowledged that the CMA played a crucial role in the decision-making process. In an interview with the BBC’s Today Programme, Smith praised the CMA for being “tough and fair” commending the authority for compelling Microsoft to alter its proposed acquisition structure.

The initial rejection by the CMA in April last year centered around fears that Microsoft’s acquisition of Activision Blizzard would stifle innovation and limit choices for consumers in the rapidly expanding cloud gaming sector. The competition regulator eventually greenlit the deal in October after Microsoft revised its offer to address the CMA’s concerns.

Smith stated, “It pushed Microsoft to change the acquisition that we had proposed, for Activision Blizzard to spin out certain rights that the CMA was concerned about with respect to cloud gaming.” The tech giant’s willingness to adapt its offer showcased a pragmatic approach, providing a path forward for innovation and investment, according to Smith.

Despite the resolution, the CMA criticized Microsoft for its conduct during the process. Sarah Cardell, the head of the competition watchdog, expressed dissatisfaction with Microsoft’s tactics, emphasizing that dragging out proceedings in such a manner only wasted time and money.

Microsoft’s initial plan to acquire Activision Blizzard, marking the largest takeover in gaming industry history, faced regulatory scrutiny globally. The revised deal involved Microsoft transferring the rights to stream Activision games from the cloud to Ubisoft, a French video games publisher, for 15 years. This restructuring aimed to address concerns and ensure continued access for gamers on rival consoles.

In his reassessment of the UK, Smith also highlighted Microsoft’s £2.5 billion commitment to invest in AI infrastructure in the country over the next three years. He lauded the UK government’s proactive approach in committing £900 million to build essential infrastructure for the country’s researchers, emphasizing the positive developments at the end of the year.

This shift in perspective signifies a collaborative effort between Microsoft and regulatory authorities, underscoring the importance of adaptability and cooperation in navigating complex business landscapes.