The extension will give the watchdog more time to review proposals by the two parties to resolve its concerns after it paused a campaign to block the deal.
“The Inquiry Group has decided to extend by six weeks … as it considers that there are special reasons to do so. The revised period will therefore end on 29 August 2023,” the U.K. Competition and Markets Authority said Friday.
The British regulator has been a stalwart opponent of Microsoft’s $69-billion purchase of Activision Blizzard, inclusively blocking the deal in April over competition concerns in the nascent cloud gaming market.
The CMA appeared to soften its tone earlier in the week, signalling it was ready to resume discussions with the tech titan. That softened stance came after the U.S. Federal Trade Commission’s attempt to block the deal was slapped down by a judge.
“We stand ready to consider any proposals from Microsoft to restructure the transaction in a way that would address the concerns set out in our Final Report,” a CMA spokesperson said via email on Tuesday.
The CMA’s concerns have centred on the likelihood of Microsoft making Activision games exclusive to its own platform, as the tech giant sets its sights on the budding cloud gaming market.
Microsoft’s multiple concession offers to the CMA has so far yet to bear fruit. These include deals to license some of Microsoft and Activision games to other cloud gaming providers. However, the CMA flat out rejected these proposals, effectively saying they were hard to enforce and wouldn’t do enough to protect competition in the cloud gaming market.
Now Microsoft and Activision will need to come up with new proposals that go further than that, in order to allay the CMA’s concerns. This could include bolstered licensing deals or even a potential spinoff of its cloud gaming business in the U.K.