CMA Issues Preliminary Approval of Restructured Activision Blizzard Sale to Microsoft

Blizzard Posted 2023/09/22 at 11:50 AM by Archimtiros

preliminary approval of the merger between Microsoft and Activision Blizzardmoved to block the deal last Aprildivest cloud gaming rights of Activision Blizzard games to Ubisoft

Competition and Markets Authority

The CMA considers that the restructured deal makes important changes that substantially address the concerns it set out in relation to the original transaction earlier this year.

In particular, the sale of Activision’s cloud streaming rights to Ubisoft will prevent this important content – including games such as Call of Duty, Overwatch, and World of Warcraft – from coming under the control of Microsoft in relation to cloud gaming. The CMA originally found that Microsoft already has a strong position in cloud gaming services and could have used its control over Activision content to stifle competition and reinforce this position. The new deal instead results in the cloud streaming rights for Activision’s games being transferred to an independent player, Ubisoft, maintaining open competition as the market for cloud gaming develops over the coming years.shared his enthusiasmActivision Blizzard CEO Bobby Kotick released a message

Bobby Kotick

Team,

I want to share an important update on our planned merger with Microsoft.

Today the UK regulatory authority, the CMA, issued a preliminary approval of our merger with Microsoft based on the solutions Microsoft presented in connection with its new merger application. This approval is critical to completing our merger.

The next step is for the CMA to gather third-party feedback, after which the CMA will reach a final decision.

As I said when we announced the deal, this transaction will help us accelerate our ambitions for the future of gaming and enable us to better serve our players. Microsoft recognizes the commitment to excellence and creative independence that has served us well for the last 30 years. I am confident that their resources, technology, and tools will provide us even greater opportunities to create even better games.

This is a significant milestone for the merger and a testament to our solutions-oriented work with regulators. I remain optimistic as we continue the journey toward completion and am very grateful to each of you for your dedication and focus throughout this process.

As the regulators continue their process, I will keep you updated on our progress towards our expected closing.

With gratitude,

Bobby

Comment by NanerFishCan someone explain this better? I still got kind of confused from all the bureaucrat talk.Comment by AnkerJymSomeone who knows more about this business jargon explain to me, what does giving rights over to Ubisoft do for the average Blizz game player? Would we even be affected?Comment by TchernobylCan someone explain this better? I still got kind of confused from all the bureaucrat talk.Comment by DeadprincessXTI don't know but... who tf cares about cloud gaming? I don't know a single person that cares about cloud gaming and no one is interested in using it in the future. Myself includedComment by novadudecloud gaming sucks unless you wants 10 second lag inputComment by NanerFishCan someone explain this better? I still got kind of confused from all the bureaucrat talk.Comment by maswellAs much as I like competition and anti monopoly stuff, I don't want Ubisoft anywhere near this. They aren't good at this kind of stuff. I'm very wary of this. Typical gov regulation. They try to help and will probably end up making it worse. Why does the UK insist on pretending they are still relevant anyway. Pining for the good old days.Comment by akaRavenGood or bad, we will soon see, but could it be worse than what we have?Comment by NnycoI love how this entire thing goes on because of ... cloud gaming of all things. But then look at all those boomers in charge, they prolly dont even know what that is and they just got razzled by a fancy buzzword.Comment by Excelsior44Ubisoft will have exclusive control of those streaming rights outside of the European Union, allowing the company to make those games available on its own Ubisoft+ service and to license them out to other cloud-gaming providers (including Microsoft itself). In the EU, Microsoft will pay to license those Activision streaming rights back from Ubisoft to satisfy promises made to the European Commission regarding free licensing to competing cloud-gaming providers.Comment by KerathrasLong story short: there is no stopping the deal now. The merger will just continue to go through the motions until the senile old men in charge at the regulatory agencies who think cloud gaming is some kind of high tech voodoo are satisfied. This type of divestment is par for the course, the fact that Ubisoft will act as the intermediary is basically just a formality.Comment by pawpurrI've never heard anything good about this organization. I don't have enough of a British accent to judge them for myself, I'm sure they serve some function but.. the most plausible thing I've heard is that Sony has some contact in this group and that's why they're dragging their feet.Comment by WillowFaeHere's how I understand this as a basic gamer, and I'll separate it into two bullets to address the CMA's response and Kotick's response separately:

CMA: "Microsoft is too strong and too influential, so we're aiding Microsoft in agreeing to give games that depend on cloud storage, such as Call of Duty, Overwatch, and World of Warcraft to Ubisoft so that it's fair and that they can't pull a Sony on the community."

To me, this seems like a heavy-handed attempt to place Ubisoft back into a position where they generate income from being a distributor and not a creator, as their products have been rather mixed and on the downswing of the community's favor in more recent years. It seems like the new attempt at a 'Stadia', only instead of a game console, it's an entire company still trying to have its cake and eat it. This is speculation on my part, but I think it's a possibility to consider since this is Ubisoft and Kotick, both motivated by money and not by the interest of the gamer community. 'Know your enemy' and all that. I'm not a fan of either.

Kotick: "To my most irreplaceable hand-selected personnel, we're making progress with the CMA but they require third-party feedback yet again to see if this merger is profitable to proceed. We've gone from a 'maybe' to an 'almost-yes', and my ambitions in the 'Search For More Money' series are hopefully bearing fruit. Microsoft still sees us as an acquirable asset, and I am completely on board with them in this regard despite the hands and visions changing over the past thirty years. I am confident that with Microsoft backing us instead of the less-favorable Activision title that we'll acquire a lot more money and hands in which we can create more content to gain more money. I am looking forward to this, as it is highly-favorable for me and therefore that's all you need to know. We are Pending, and you should be looking forward to the merger."

My translation is embellished, as satirical and outdated as I am, however I'm fairly certain this might be close to the truth. His speech is repetitive in a few places and is basically 'we're still processing and making friends with the CMA and Microsoft, and Microsoft is looking forward to using you to make me and themselves money'. His movements and his entire reason of being hired is to make money, and at this point we've seen the different ways of going about that goal. Whether or not we agree with the merger, it is a resounding 'most likely' while we drum our fingers waiting for the CMA to get comfortable enough and milk this out for all that it's worth. Que sera sera, my fellow gamers.Please read the original posts and take this comment with a grain of salt; understanding what's written for yourself, as well as ascertaining the understanding of those around you, is essential in uncovering whatever truth there is to be had. No one here is supposed to be vouching for 'sides', but rather your personal stance and what it means for you individually. It's your investment, your time, your money, and it does not belong to anyone else here. Be well.Comment by AurorisAs much as I like competition and anti monopoly stuff, I don't want Ubisoft anywhere near this. They aren't good at this kind of stuff. I'm very wary of this. Typical gov regulation. They try to help and will probably end up making it worse. Why does the UK insist on pretending they are still relevant anyway. Pining for the good old days.Comment by Moustrap1479One step closer to no more Kotek. Now that is a Victory for Blizzard!Comment by SoulebreakerFrom what I've read this only affects players in the UK. But Ubisoft is one of the worst companies to have handle cloud gaming, because they tried to delete older games before there was controversy. They still will delete accounts after a certain period of inactivity.Comment by sapiensits not like MS hasnt abused their market position before. what WoWhead didnt report is the further CMA notice, which still indicates an empirical suspicion and therefore a warning:

"It would have been far better, though, if Microsoft had put forward this restructure during our original investigation. This case illustrates the costs, uncertainty and delay that parties can incur if a credible and effective remedy option exists but is not put on the table at the right time."

a warning by the CMA, cuz maybe MS is aiming to aquire Ubisoft afterwards, as already their middleterm aquisition plans indicate further consolidation (Valve, Nintendo etc). a warning, cuz MS market share on cloud is likely to grow beyond the current >60% via the ABK Merger.

y is cloud relevant for gaming culture? its commonly seen as the future of the internet, where client based infrastructure will be replaced by streaming, as the impact of mobile (smartphones) already has shown the last decade. MS hasnt just a foot in the door, but already a bulldozer to direct not just technological evolutoin, but market trends and therefore customers options (and prices).Comment by NymrohdI don't know but... who tf cares about cloud gaming? I don't know a single person that cares about cloud gaming and no one is interested in using it in the future. Myself includedComment by AniseSigning over cloud hosting rights to ubifail for the next 15 years is what it took to get over the line. The cloud gaming scene is pretty much dead. Most of the players ahve pulled out. This includes google with it stadia. Thsi is the red herring they want you to focus on.Comment by DrakknfyreThe right palms were finally greased enough, that's why this is going through. No one, and I mean no one takes cloud gaming seriously. Even Google realized it was a failure and announced the shutdown of Stadia. The whole hangup over cloud gaming blocking this was just an ass-pull excuse until specific people got their pockets lined.