The EU believes that the CMA overstated Microsoft’s market shares in cloud gaming.
As is well known, the British competition authority CMA blocked the merger between Activision Blizzard and Microsoft in April. The reason for this decision is mainly based on the dominance of the market share in cloud gaming via Xbox Game Pass, which according to the authority is 60 to 70%.
However, this share does not reflect actual market conditions, as analysts and industry members have criticized. According to the Financial Times, a European Commission official said the number was overstated because the CMA counted subscribers who don’t use cloud gaming at all.
We remember: According to the latest official data from January 2022, Xbox Game Pass has 25 million subscribers. However, not all subscribers also have the Ultimate membership, which entitles them to use the cloud gaming feature. Also, not every Ultimate user should use the cloud function.
Ultimately, only Microsoft itself has numbers on cloud gaming usage.
Furthermore, the CMA is wrong in assuming that cloud gaming is a separate market. Rather, it’s a small segment, according to MiDIA Research analyst Karol Severin.
The EU has illustrated this with a graphic for the European Economic Area (EEA). It shows that cloud gaming accounts for only a small proportion at EUR 300 million compared to EUR 6 billion in the console business. The market would even benefit with the remedies where Activision Blizzard games would be available on all cloud gaming services.
It wouldn’t be the first time the CMA got things wrong. So it was initially believed that Microsoft would offer Call of Duty exclusively for Xbox consoles. It later revised its statement and financial model, stating that removing the shooter series from PlayStation would not make economic sense.
= Partner & affiliate links: Possible listed offers are usually provided with so-called affiliate links. With a purchase through one of these links you support Xboxdynasty. Without affecting the price, we receive a small commission from the provider and can offer this website to you free of charge.