CMA Just Did Not Believe Microsoft At Their Word

gameranx.com:

Everyone is rightly analyzing the fine details of CMA’s rejection of the Microsoft Activision deal. While most of that effort has been focused on what the CMA got wrong, it’s important to check some of the very basic statements that the CMA made, that led them to the conclusion that they made.

On page 293 of their 400 page decision, CMA states bluntly that they just don’t believe Microsoft. Here is the relevant passage:

“In respect of Microsoft’s submission that the agreements prove conclusively that Microsoft is incentivised to distribute Activision content widely, we consider it is relevant that these agreements were entered into in the context of an ongoing merger review process.

We consider that Microsoft entering into these agreements does not provide us with reliable evidence regarding its incentives in the same way as other past behaviour which is separate to the Merger and Merger review process, or our general analysis of the Merged Entity’s incentives above.

Accordingly, we do not consider the fact that Microsoft has entered into these agreements undermines our findings on its post-Merger incentives. Microsoft may have short-term incentives to enter into these agreements to seek to address the competition concerns arising from the Merger, but this is not informative of its longer-term commercial incentives.”

This section of the document is talking about the contracts that Microsoft entered into with the many cloud gaming companies that are their erstwhile competitors. The biggest of them all, Nvidia and their GeForce Now service, recently defended Microsoft’s deal. They also stated that they would have definitely benefited if it will go through. This is important because it directly refutes the CMA’s own claims