UK competition regulator finds Microsoft’s Xbox cloud service responsible for Google Stadia’s closure

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The preliminary findings of the UK’s Competition and Markets Authority (CMA), which is looking into how the merger between Microsoft and Activision Blizzard can hurt competition, have been published. One of the most intriguing revelations from the probe relates to Google Stadia, the cloud gaming service that was shut down in January.

One section of the CMA’s conclusions includes information on the number of players who were actively playing on each of the major cloud gaming platforms in 2021 and 2022. According to the CMA’s assessment, in 2021, Microsoft’s Xbox Cloud gaming service had 20 to 30% of the market share, while Stadia held 5-10%.

In 2022, Stadia held up to 5% only and Xbox Cloud owned 60 to 70%, thereby indicating that there was a significant market share acquired by Microsoft over a period of just one year. According to reports, Xbox Cloud gained 20% of the cloud gaming market in 2022 after fully dismantling services comparable to those provided by PlayStation and NVIDIA.

The CMA uses Google Stadia as an illustration of how a company with a strong foundation in cloud technology and enticing features could nonetheless fail due to a lack of content. It, therefore, emphasized on how Microsoft’s acquisition of Activision Blizzard can make it harder for other cloud gaming services to offer a competitive game library.

Though the CMA points out certain limits in its study it supports its claim that Microsoft will have a monopoly in the gaming industry. It also throws light on another factor that most likely contributed to Stadia’s failure, in addition to Google’s publicly disclosed platform mismanagement.

Meanwhile, in the event that Microsoft’s proposed acquisition fails, Bobby Kotick will continue in his role as CEO of Activision Blizzard. Fox Business claims that Kotick will continue to lead the gaming company if authorities stop the takeover from happening.

Many rumours were previous floating round about Kotick leaving Activision Blizzard after Microsoft’s takeover. However, the company asserted that Kotick hadn’t talked about his plans prior to or following the purchase announcement.