Microsoft says confidence in UK 'severely shaken’

By Aysu Bicer

LONDON (AA) - Microsoft President Brad Smith has criticized the UK's decision to block its purchase of US gaming company Activision, saying the European Union would be a more favorable location to start a business.

The UK's Competition and Markets Authority (CMA) on Wednesday blocked Microsoft's planned acquisition of Activision Blizzard for £55 billion (nearly $69 billion) due to concerns that it could result in reduced innovation and less choice for gamers in the rapidly growing cloud gaming industry.

Speaking to the BBC, Smith said the move was detrimental to Britain and marked Microsoft's "darkest day" in the country over its four-decade history there.

"It does more than shake our confidence in the future of the opportunity to grow a technology business in Britain than we've ever confronted before," he said.

"People are shocked, people are disappointed, and people's confidence in technology in the UK has been severely shaken.

"There's a clear message here -- the European Union is a more attractive place to start a business than the UK."

However, the UK watchdog argued that it had to prioritize people's interests over commercial interests when making decisions.

Although regulators in the US and EU have not yet made a decision on whether to approve the deal, the CMS said "Activision is intertwined through different markets -- it can't be separated for the UK. So this decision blocks the deal from happening globally."

With its ownership of Xbox, the leading PC operating system (Windows), and a global cloud computing infrastructure (Azure and Xbox Cloud Gaming), Microsoft already controls an estimated 60%-70% of the global cloud gaming market.