Topline The U.K.’s Competition and Markets Authority has approved Microsoft’s $68.7 billion acquisition of video game publisher Activision Blizzard, removing the final regulatory hurdle for a deal first announced in January last year.
The CMA approval opens the door for Microsoft to finally complete its acquisition of Activision … [+] Blizzard.
Anadolu Agency via Getty Images Key Facts The CMA said Microsoft’s restructured deal—which transfers the cloud gaming rights for Activision Blizzard’s game to French publisher Ubisoft in some markets—addresses its concerns about competition in the emerging cloud gaming space.
The regulator said Microsoft’s cloud gaming related concessions are a “gamechanger that will promote competition” and preserve “competitive prices” for cloud gamers in the U.K.
The restructured deal means that Microsoft will not control the cloud gaming rights for Activision Blizzard’s games outside the EU—giving Ubisoft these rights for 15 years.
The deal allows Ubisoft to license Activision’s games for Microsoft’s Xbox Cloud Gaming service, along with competitors like Sony.
Crucial Quote Microsoft President Brad Smith applauded the decision, saying: “We’re grateful for the CMA’s thorough review and decision today. We have now crossed the final regulatory hurdle to close this acquisition, which we believe will benefit players and the gaming industry worldwide.”
What To Watch For With the final regulatory hurdle cleared, Microsoft now has the green light to close the deal. It is unclear how quickly this will happen and the immediate impact it will have on Xbox gamers. The main subject of interest is likely to be the addition of Activision Blizzard’s expansive library of games to Xbox Game Pass—including the Call of Duty series. The most keenly followed move will be the potential addition of the next major release in the shooter franchise, Call of Duty: Modern Warfare III, to Microsoft’s monthly subscription service. The game is set to release on Windows, Xbox and Sony’s PlayStation platforms on November 10 and is expected to be among the top-selling launches this year.
Key Background Microsoft announced the nearly $69 billion deal—the biggest in the history of the video games industry—last January. The acquisition came under major regulatory scrutiny, amid concerns it could damage competition in the gaming market. Sony, the maker of the PlayStation and Microsoft’s main rival in the console gaming business, was the most vocal opponent of the deal. Sony expressed concern that Microsoft could harm PlayStation by making the popular Call of Duty games, or at least some of its key features exclusive to Xbox. The biggest regulatory hurdles were raised by the Federal Trade Commission in the U.S.—which is suing to block the deal—and the U.K. CMA, which initially blocked the acquisition over its cloud gaming concerns. Despite its ongoing court case with the FTC, a federal judge ruled Microsoft can close the deal.
Further Reading Microsoft’s $69 Billion Activision Deal Nears Approval As U.K. Looks Poised To Clear Gaming Takeover (Forbes)
Microsoft’s Xbox Plans Leaked—Unredacted FTC Filing Show Talks About Potential Nintendo Acquisition (Forbes)