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As is now tradition, an enormous piece of gaming news landed right after last week’s Pushing Buttons went out to readers: Microsoft’s huge $70bn purchase of Call of Duty, World of Warcraft and Candy Crush owner Activision Blizzard, a deal that has been in the works since January last year, was unexpectedly blocked by a UK regulator.

This might not seem interesting to anyone except those involved with the business of video games, or people with an inexplicable interest in the actions of regulatory authorities in Britain, but wait! It is quite interesting, because the response from these two giant companies has been entertainingly petty.

All corporations are entitled brats. For decades, US- and UK-driven neoliberalism has empowered them to consider themselves legally equivalent to actual people, and deserving of privilege, ostensibly because they create wealth and jobs. They are used to holding sway over governments and authorities and when things don’t go their way, they throw a tantrum about it, in this case by threatening to withhold investment in the UK unless they get what they want.

Activision’s statement sounds downright retaliatory: “The report’s conclusions are a disservice to UK citizens, who face increasingly dire economic prospects. We will reassess our growth plans for the UK. Global innovators large and small will take note that – despite all its rhetoric – the UK is clearly closed for business.”

Microsoft president Brad Smith struck a similar tone, sounding absolutely furious. “It does more than shake our confidence in the future of the opportunity to grow a technology business in Britain than we’ve ever confronted before … People are shocked, people are disappointed, and people’s confidence in technology in the UK has been severely shaken. There’s a clear message here – the European Union is a more attractive place to start a business than the United Kingdom.”

I find this very amusing, because Smith (pictured above) is talking about a $70bn acquisition of one of the biggest companies in video games by one of the biggest companies in tech, not some plucky upstart. It’s about as far from starting a business as it is possible to get. And as a UK government spokesperson pointed out in response to Activision and Microsoft’s attacks, our tech sector is hardly ailing compared to Europe’s. Neither is our gaming sector. In this context, Microsoft and Activision’s words come across as empty, petty threats.

For the actual players of video games (you, dear reader), the reason why the Competition and Markets Authority (CMA) blocked the deal should be of interest. The major, obvious feature of this acquisition is that it would give Microsoft control of Call of Duty, one of the biggest games in the world. It would be an enormous blow to Sony if COD were to disappear from PlayStation. Supporters of the deal say it wouldn’t make sense to keep the game away from competitors, because it would lose Microsoft millions in profits. The problem with this line of argument is that Microsoft can afford to swallow that loss. Buying Bethesda and keeping Starfield and the next Elder Scrolls title away from PlayStation will also lose Microsoft millions, but the company is happy to do it regardless.

So we’ve spent the past year watching Microsoft and Sony have a public squabble over that issue, and seen Microsoft forced to promise they will offer Call of Duty on other platforms for at least the next 10 years in attempt to assuage regulators’ concerns. But, in the end, Call of Duty was not the real problem. Instead the CMA has zeroed in on the still-nascent concept of cloud gaming. It says that allowing Microsoft to buy Activision will give it undue power to shape the future of gaming, rather than its present.

Right now, gaming mostly works as it has for decades: you buy a console, you buy games to play on it – whether physically or digitally. But it seems very likely that in the future, we will pay a subscription and play games on any screen available to us, with all the computational power offloaded onto servers far, far away, rather than a box under the TV.

This has been technically possible for a while, but so far nobody has made it work as a business. (RIP, OnLive and Google Stadia.) But Microsoft has the best chance yet. Cloud gaming already works on Xbox – if you’re a Game Pass subscriber, you can play games without downloading them right now. The CMA’s conclusion is that owning Activision’s games would make Microsoft too powerful in this emerging market, which in another five-to-10 years could well be the dominant way that we play games.

This is a valid concern. Nobody else in the gaming world can come close to Microsoft’s technological infrastructure, or its ability to absorb financial losses in pursuit of market share. People at Xbox have repeatedly told me, in conversations over the last 18 months, that this was never about Call of Duty in the first place: it was about buying Microsoft a dominant position in the mobile market with Candy Crush developer King (part of Activision), and strengthening its hold on PC with World of Warcraft and Diablo. Personally, I also believe that it’s about making Xbox’s Game Pass subscription into an offer that nobody can refuse. Pairing Activision Blizzard’s games with a low subscription price and folding cloud gaming into that mix, letting people play Call of Duty (pictured above) without having to buy a console at all, would be an extremely potent offer.

Despite the setback, this deal may yet still go through. Microsoft and Activision can appeal, and they will (for more detail on the business side of things read Alex Hern’s TechScape newsletter from yesterday). While it’s still not in the clear with US or EU regulators, if one of those regulatory authorities approves the purchase, the others might feel more pressure to follow suit (although Japan doing just that didn’t sway the CMA).

Perhaps unsurprisingly for someone who writes for the Guardian, I am anti-corporate by instinct, and suspicious of attempts by any big tech companies to buy success in the video games world. This is a creative industry as much as a tech one, and history has repeatedly proven that corporate influence on the arts is rarely positive. Just look at the current writers’ strike in the US. My primary concern lies with the people working on games at these companies’ studios, and how their lives and creativity might be positively or negatively impacted by such a merger. But a deal this big has wider implications, too.

Despite decades in video games, the Xbox has never taken a lasting lead over Sony’s PlayStation; Xbox still does not have the consistent quality and instantly recognisable games that Sony and Nintendo have. This acquisition solves both of those problems for Xbox, and gives it an instant huge presence in the extremely profitable world of mobile games. With those problems solved, the CMA is right to be concerned about how Microsoft could then warp the future of games in ways that are difficult to foresee.

What to play

EA and Respawn’s Star Wars Jedi: Survivor came out last week, and our critic Rick Lane called it the best Star Wars game in 20 years. “It’s everything you want from a Star Wars adventure and a blockbuster video game: visually spectacular, mechanically sophisticated and riotously entertaining,” he wrote. The appeal for me is not so much the Jedi set-dressing as it is the adventurous combination of player-directed planetary exploration, flexible lightsaber combat and acrobatic wall-climbing – basically, I’m searching for the ideal combination of Tomb Raider and Metroid Prime, and if that arrives in the form of a Star Wars game, I’m here for it.

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