Microsoft‘s final roadblock to completing its acquisition of Activision Blizzard is the UK CMA. The IT business appears to be taking the CMA’s recommendation into consideration as it applies for regulatory approval to offload a portion of Activision Blizzard.
Microsoft is transfering its cloud streaming rights for Activision Blizzard games to Ubisoft.
The only regulatory authority in the world to oppose Microsoft’s proposed merger with ActivisionBlizzard is the UK CMA. The merger has received approval from a total of 41 different nations and territories, including the European Union. In a separate legal victory, Microsoft defeated the US FTC, which had also sought to scuttle the acquisition.
Microsoft has suddenly changed its proposed acquisition of Activision Blizzard, declaring that it will give Ubisoft the cloud streaming rights to all Activision Blizzard titles for the following 15 years. The IT company aspires to allay the worries expressed by the UK CMA in response to its rejection of the $69 billion transaction.
In order to resolve the UK Competition and Markets Authority’s concerns about the proposed acquisition’s potential effects on cloud game streaming, Microsoft President Brad Smith announced the restructuring of the transaction in a blog post on August 22. This includes concluding an agreement that will go into effect upon the completion of our merger and transfer to Ubisoft Entertainment SA, a renowned international game publisher, the cloud streaming rights for all new and existing Activision Blizzard PC and console games released over the ensuing 15 years. The rights will last forever.
The next step in the UK for Activision Blizzard s deal with Microsoft:
Our CEO just sent this email to all employees pic.twitter.com/kqtD07bMwK
Lulu Cheng Meservey (@lulumeservey) August 22, 2023
Activision Blizzard games will be added to Ubisoft+ and made available on systems like the PlayStation through Ubisoft Plus Classic, according to Ubisoft. Additionally, non-Windows PCs can access these games through the French gaming firm. Microsoft will receive a single payment from Ubisoft and payment through a “market-based wholesale pricing mechanism.”
According to Smith, “Ubisoft will make a one-time payment to Microsoft in addition to using a market-based wholesale pricing structure, which includes a usage-based pricing option, to recompense Microsoft for the cloud streaming rights to Activision Blizzard’s games. Additionally, it will allow Ubisoft to make Activision Blizzard games available to cloud gaming services using non-Windows operating systems.
After Microsoft defeated the Federal Trade Commission in a US federal court last month, the tech giant and the Competition and Market Authority agreed to discuss. As a result of Microsoft restructuring its agreement with Activision Blizzard, the UK anti-trust agency will now launch a new probe. The Xbox manufacturer anticipates the evaluation procedure to be finished before the deadline of October 18th to complete the merger.
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While it examines the reorganization of the proposed merger, the CMA has issued a definitive order blocking the original agreement between Microsoft and Activision Blizzard on a global scale. According to a press statement from the CMA, “Ubisoft will also be able, for a fee, to require Microsoft to adapt Activision’s titles to operating systems other than Windows, such as Linux, if it decides to use or license out the cloud streaming rights to Activision’s titles to a cloud gaming service that runs a non-Windows operating system.”
The Ubisoft+ lineup is expanding!
We’re excited to announce a new agreement that will bring Activision Blizzard games to Ubisoft+ via streaming upon the completion of Microsoft s acquisition of Activision Blizzard!
We ll also be licensing the games to a range of cloud streaming pic.twitter.com/sZTnEFJedC
Ubisoft (@Ubisoft) August 22, 2023
Microsoft will still be required to uphold its duties under its contracts with cloud gaming service providers and to the European Commission. While the proposed acquisition was being looked at, the company struck multiple agreements with cloud gaming suppliers.
According to Smith, “the agreement with Ubisoft has been structured so that Microsoft will still obtain the rights needed to honor fully its legal obligations under its commitments to the European Commission, as well as its existing contractual obligations to other cloud game streaming providers, including Nvidia, Boosteroid, Ubitus, and Nware.”
According to the CMA, it will examine the restructured contract and make a determination by October 18. The UK authority made it clear that it is not yet granting the go-ahead.
The light is not green. According to Sarah Cardell, chief executive of the CMA, “We will carefully and objectively assess the specifics of the restructured deal and its impact on competition, including in light of third-party comments.” “Our goal has not changed. Any decision made in the future regarding this new agreement will guarantee that the expanding cloud gaming market continues to benefit from open and effective competition that fosters innovation and choice.”
The deadline to seal the transaction has been extended by Microsoft and Activision Blizzard to October 18. In the event that the deal goes through, the computer giant will be required to pay a hefty fee.