Microsoft mentioned the future of cloud gaming in a lengthy response (opens in new tab) to the UK Competition and Markets Authority's (CMA) decision to launch a detailed "Phase 2" investigation (opens in new tab) into the company's acquisition of Activision Blizzard. Aside from the marketing of Microsoft's xCloud game streaming service, the company's prospects for cloud gaming turned out to be rather bleak, at least in the short term.

Cloud gaming is "a new and immature technology, and the CMA recognizes that it faces significant challenges," Microsoft wrote, adding that consumer adoption of the technology "will not proceed rapidly because it requires significant changes in consumer behavior." Rather than an impending cloud revolution, Microsoft predicts that "PC and console gamers will continue to download the majority of the games they play instead of adopting the streaming alternative."

This is in marked contrast to the company's bullish public stance on its own streaming service, xCloud: at an E3 event three years ago, Xbox boss Phil Spencer took the stage (opens in new tab) and promoted the service with characteristic enthusiasm While he was touting the service with characteristic enthusiasm, Microsoft appears to have much more modest expectations for xCloud and game streaming as a whole on the inside.

Microsoft is speaking (or being honest) about its near-term prospects for cloud gaming to counter CMA claims that it might use the Activision Blizzard acquisition to freeze out competitors in the game streaming market. Instead, Microsoft says that because adoption of the technology is so sparse, "harming or degrading the services of rivals would significantly set back the adoption of this technology" and "market-leading incumbents" like Sony for consoles, Google and Apple for mobile, and Steam for PCs

Microsoft's "market-leading incumbents" such as Sony for consoles, Google and Apple for mobiles, and Steam for PCs.

Microsoft argues that it would be far more beneficial to encourage "widespread adoption of cloud gaming technology by as many providers as possible" than to increase its dominance over cloud gaming. Doing so, Microsoft says, would encourage "the major shift in consumer behavior necessary for cloud gaming to succeed."

So, in essence, Microsoft claims that it is not interested in monopolizing cloud gaming. Since the technology is still nascent and its adoption is negligible, the main challenge for the time being is to convince players that this technology is worth their time, regardless of who provides it, given the impending death of Google Stadia (opens in new tab), it is hard to find fault with Microsoft's claims.