Microsoft Activision Blizzard
The Microsoft Activision Blizzard deal faced a significant hurdle when the CMA initially blocked it due to concerns about its impact on the emerging cloud gaming market. In response, Microsoft proposed a restructuring, offering to sell cloud streaming rights to Ubisoft, which prompted a new merger inquiry by the CMA.
The good news is that this move seems to have satisfied the CMA to a large extent. While some residual concerns remain, Microsoft has put forth remedies aimed at addressing these issues. The CMA’s provisional decision indicates that the restructured deal, while materially different from the original, has made substantial progress in alleviating most concerns.
However, the CMA does express limited residual concerns regarding certain provisions in the sale of Activision’s cloud streaming rights to Ubisoft, potentially being circumvented, terminated, or not enforced. To tackle these concerns, Microsoft has offered remedies to ensure the enforceability of these terms, which the CMA provisionally believes should resolve these remaining issues.
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The CMA has initiated a consultation period that will run until October 6, following which a final decision will be made. Unless significant objections emerge that shed new light on the situation, it is highly likely that the CMA will ultimately approve the deal.
Microsoft’s President and Vice Chair, Brad Smith, expressed encouragement over this positive development in the CMA’s review process. He emphasized their commitment to addressing the CMA’s concerns related to cloud game streaming and their determination to secure approval before the October 18 deadline.
In summary, the Microsoft Activision Blizzard deal is making progress towards approval, with the CMA’s provisional decision pointing towards a favorable outcome. This new and substantially different deal aims to maintain cloud distribution through Ubisoft, preserving market structure and promoting open competition in the cloud gaming arena. UK gamers can look forward to accessing Activision’s games through various means, including cloud-based multigame subscription services.
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