The UK antitrust regulator has blocked Microsoft’s $69 billion purchase of Activision Blizzard, thwarting one of the tech industry’s biggest deals over concerns that it will stifle competition in the market for cloud gaming. The Competition and Markets Authority said in a statement Wednesday that it was worried the deal would alter the future of the fast-growing cloud gaming market, leading to reduced innovation and less choice for UK gamers over the years to come. The deal would make Microsof (MSFT)t even stronger in cloud gaming, a market in which it holds a 60%-70% share globally, the regulator added. Both companies plan to appeal the decision. “Alongside Microsoft, we can and will contest this decision, and we’ve already begun the work to appeal to the UK Competition Appeals Tribunal,” Activision Blizzard CEO Bobby Kotick said in a statement. Microsoft President Brad Smith added: “This decision appears to reflect a flawed understanding of the market and the way the relevant cloud technology actually works.” The Competition and Markets Authority, which launched an in-depth review of the blockbuster deal in September, said Microsoft’s proposed remedies to its concerns had “significant shortcomings.” “Their proposals... would have replaced competition with ineffective regulation in a new and dynamic market,” explained Martin Coleman, chair of the independent panel of experts conducting the investigation. “Microsoft already enjoys a powerful position and head start over other competitors in cloud gaming, and this deal would strengthen that advantage, giving it the ability to undermine new and innovative competitors,” Coleman continued. “Cloud gaming needs a free, competitive market to drive innovation and choice.” The UK cloud gaming market is expected to be worth up to £1 billion ($1.2 billion) by 2026, around 9% of the global market, according to the Competition and Markets Authority. — CNN