It might be deader than dead now but that doesn't mean it always will be. As has been pointed out in the other thread with a link to an article on the topic, the decision is about preventing issues from cropping up in the future. It's a proactive block now rather than a reactive anti-trust lawsuit later.
But I feel ya about infrastructure. I live in rural Oklahoma and I'm lucky to have one high speed internet provider, which works about 85% of the time. Far too many outages and slowdowns for cloud to be effective right now. But if they just look at the here and now and give Microsoft all these resources, it's not farfetched to see a future where Microsoft has absolute dominance in cloud, server side hosting, and software to leverage people to only their cloud services.
Besides, Microsoft themselves have been banging about how the cloud is their "#1 priority" for years now. They can't turn around and complain when that very priority turns out to be the reason their acquisitions are blocked.
I definitely see the decision asap reaction of future prevention, but that future is very predicated on a model of global infrastructure. Realistically, first world countries won't suddenly have cloud-gaming capable infrastructure built out in the next 10 years because it costs a stupid amount of money. Add in a current recession that will easily disrupt any economic plans currently in place, or were for COVID, and you can easily see nothing is going to happen anytime soon.
Governments around the world are contracting, because they had to spend big during COVID to ensure their country didn't jump off a cliff. Now we are seeing those choices needing to be pulled back through inflation measures, which results in reduced government spending in order to retain normality/control. Infrastructure is one of those that gets significantly reduced unless it is literally falling apart.
I just can not foresee a 10 year Phoenix rising of cloud gaming. I understand the need to protect all potential markets coming into fruition, and as you said Microsoft put heavy weight on the cloud in the last five years. It is just very difficult to see the dominance that the CMA is speaking of because it is so reliant on global infrastructure and the experience being 1:1 with typical hardware play.
No one is going to play games via cloud anytime soon with the horrendous ms quality, that is quite literally a deal breaker. So I just don't agree with CMA on the basis of cloud gaming prevention due to a belief Microsoft could become the monopoly through IP power (really in 10 years I doubt ABK's IPs are going to be that impactful), as it relies heavily on a system that so far shows no promise. Also throw in the fact CMA's cloud-gaming userbase numbers being drawn down from Game Pass subscriptions because you can't split the two, it shows a flawed decision.