UK Regulator Grants Preliminary Approval To Microsoft’s Activision Blizzard Acquisition

Microsoft’s Proposed Ubisoft Deal Receives Preliminary Approval from U.K. Regulator

Last month, Microsoft submitted a new deal to the U.K.’s Competition and Markets Authority (CMA) regulatory agency in order to address concerns related to its acquisition of Activision Blizzard. The deal proposes that Ubisoft receive the rights to Activision Blizzard game streaming for 15 years, effectively preventing Microsoft from gaining control over cloud gaming. Now, one month later, the CMA has granted preliminary approval to Microsoft, citing remedies proposed by the company that address the concerns raised. 

The CMA acknowledges that it still has “limited residual concerns” about certain provisions in the sale of cloud streaming rights to Ubisoft, but believes that Microsoft’s offered remedies should address these concerns. The CMA is currently consulting on these remedies and plans to make a final decision before the October 18 deadline. 

The CMA states that the restructured deal between Microsoft, Activision Blizzard, and Ubisoft is significant in preventing Microsoft from consolidating its position in cloud gaming. By transferring the cloud streaming rights to an independent player, competition in the market for cloud gaming can be maintained and fostered. However, the CMA emphasizes the need for enforceable terms in the sale of rights to ensure that the delivery of the deal remains intact and effective. 

CMA CEO Sarah Cardell notes that the agency’s commitment to preserving competition, innovation, and choice in cloud gaming has been consistent throughout the process. Cardell also mentions that it would have been preferable if Microsoft had proposed this restructure during the original investigation, as it would have saved time, uncertainty, and delay. 

Microsoft’s vice chair and president, Brad Smith, expresses encouragement following the CMA’s preliminary approval. He affirms that Microsoft presented solutions that address the remaining concerns related to cloud game streaming and states that they will continue to work towards obtaining the final approval before the October deadline. 

Activision Blizzard CEO Bobby Kotick shares an email with the company, stating that the CMA’s preliminary approval is critical for completing the merger with Microsoft. Kotick highlights Microsoft’s recognition of Activision Blizzard’s commitment to independence and expresses confidence in the opportunities provided by Microsoft’s resources and technology to create better games. He remains optimistic about the merger and appreciates the dedication and focus of the team throughout the process. 

For a recap, Microsoft announced its acquisition of Activision Blizzard for $69 billion, followed by the CMA’s initial rejection of the acquisition over cloud gaming concerns. The FTC’s preliminary injunction request was also denied by a California judge. Microsoft has since proposed the Ubisoft deal to address regulatory concerns. Stay updated on the progress of the merger by reading our related articles.

How do you feel about Ubisoft handling the streaming of Activision Blizzard games in the UK? Let us know in the comments below!