Microsoft has not yet been able to finalize the purchase of Activision Blizzard due to the requirements of the UK's Competition and Markets Authority (CMA). Because of this, the company decided to restructure its acquisition offer in a major way, as it will sell the cloud gaming rights to current and future Activision Blizzard titles to Ubisoft.
The CMA initially blocked the purchase because of everything related to cloud gaming. So with this new move Microsoft hopes to convince the regulator. But what does it all mean and what will it mean for the company and Ubisoft? We tell you about it below.
Microsoft will make deal with Ubisoft to convince the CMA
The CMA argues that Microsoft will have a privileged position in the cloud gaming market if it buys Activision Blizzard. The regulator fears that certain content will be exclusive to Xbox Cloud Gaming, so it did not accept the deal in its original state.
Now, Microsoft decided to modify it and involve Ubisoft and its Ubisoft+ service. If the deal is finalized, the terms will be as follows:
- Microsoft will not be able to make Activision Blizzard games exclusive to Xbox Cloud Gaming
- It will also not exclusively control the licensing terms of Activision Blizzard titles on competing services
- Ubisoft will have control of the streaming rights to Activision Blizzard's current and future games for the next 15 years. In addition, it will license the titles to Xbox Cloud Gaming
- Ubisoft will be able to add Activision Blizzard titles to the Ubisoft+ Multi Access catalog, available on consoles and PC
- The French studio will be able to require Microsoft, for a pre-payment, to port Activision Blizzard games to non-Windows operating systems
- This new agreement will not affect the previous deals Microsoft made in the cloud gaming market with companies such as Nvidia, Boosteroid, Ubitus and Nware
Brad Smith, president of Microsoft, explained that with this agreement they hope to address all of the CMA's concerns and thus be able to close the deal.
“Ubisoft will compensate Microsoft for the cloud streaming rights to Activision Blizzard’s games through a one-off payment and through a market-based wholesale pricing mechanism, including an option that supports pricing based on usage.
“It will also give Ubisoft the opportunity to offer Activision Blizzard’s games to cloud gaming services running non-Windows operating systems,” the executive explained.
Today we submitted a restructured proposal to the CMA for approval of our Activision Blizzard acquisition under UK law. This new proposal also honors our prior commercial and regulatory commitments. Read more here: https://t.co/t0UBcouTP9
— Brad Smith (@BradSmi) August 22, 2023
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