Brad Smith told the BBC that the move was “bad for Britain” and marked the “darkest days” of Microsoft’s four decades of operations in the country.
The regulator hit back, saying it must do what’s best for people, “not merging companies with commercial interests”.
The move by the UK means the multi-billion dollar deal cannot go ahead globally.
While US and EU regulators are yet to decide whether to approve the deal, the UK regulator’s Competition and Markets Authority (CMA) said: “Activision engages through different markets – it cannot be isolated to the UK. So this decision prevents the deal from happening globally. gives
If approved, the $68.7bn (£55bn) deal would have been the biggest takeover in the gaming industry and would have seen Microsoft acquire massively popular game titles such as Call of Duty, Candy Crush and World of Warcraft.
Both Microsoft and Activision have announced their intention to challenge the ruling made by the CMA.
‘Clear Message’
During an interview with the BBC’s Wake Up to Money program, Mr Smith expressed Microsoft’s disappointment with the CMA’s decision, adding that he believes it will negatively affect Britain.
“It gives us even more confidence in the future of opportunities to grow a tech business in Britain than we’ve ever faced before,” he said.
The citizens of the UK are feeling shocked, disappointed, and their trust in technology has been dramatically undermined.
The message is clear: starting a business in the EU is more appealing than starting one in the UK.
According to a statement from a representative of Prime Minister Rishi Sunak, Mr Smith’s assertion that the CMA’s decision was harmful to Britain and that the EU was a better business destination is incorrect.
“The truth does not bear out these kinds of claims,” the spokesperson said, adding that the UK games sector has doubled in the past ten years.
He said the government would engage with Microsoft but noted that the CMA is independent.
For the deal to work, it must be approved by regulators in the UK, US and EU.
The US Federal Trade Commission filed a legal challenge to stop the takeover last year, but the UK was the first to announce its decision. In March, Microsoft made concessions to obtain the contract, causing EU regulators to delay their decision.
The UK government has made “light-touch” rules for science and technology one of its post-Brexit goals to encourage economic growth.
However, several recent takeovers of British firms by foreign players have raised concerns that the UK market needs to catch up and attract fast-growing technology firms.
Microsoft has already said that the decision could affect its UK investment.
Mr Smith suggests that for the UK to attract investment, it is crucial to thoroughly analyze the role of the CMA and the regulatory framework.
The UK is ‘fully open for business.
Sarah Cardell, chief executive of the CMA, told the Today program that she disagreed with Mr Smith’s comments.
He stated that this move emphasizes the significance of promoting competition in the UK and highlights that the UK welcomes business.
“We want to create an environment where various companies can compete effectively, grow and innovate.”
The regulator ruled on Wednesday that the proposed deal would negatively impact innovation and limit options for gamers in the rapidly expanding cloud gaming industry. The purchase of subscriptions for online game access may become a cause for worry.
The merger is important for Microsoft as it sees cloud gaming as the industry’s future and seeks to strengthen its position in the market.
The Activision deal will also give it some popular game titles to compete more effectively with rivals like Sony.
Sony’s position is that if the deal goes ahead, Microsoft will be incentivized to limit access to Activision’s titles on PlayStation, which would be bad for gamers.
According to CMA, Microsoft currently dominates the cloud gaming market with a 60-70% share, and the acquisition of Activision will further solidify their already strong position.
According to Ms Cardell, allowing Microsoft to acquire TikTok would negatively impact other cloud platforms’ ability to compete, ultimately harming the innovation and product choice in the market. Gareth Sutcliffe, a senior games analyst at Enders Analysis, believes that Microsoft’s approach needs to be corrected.
Signs had been clear for months that the deal was in trouble with UK regulators, he told the BBC, yet Microsoft executives had not prioritized it or paid attention to the evidence.
Mr Sutcliffe added that Mr Smith’s comments about the UK were “a little off the mark”.
“They [Microsoft] have had ample opportunity to do things differently in the last 16 months — they’re a twenty did not provide a viable enough case.”
