The anticipated $69 billion acquisition is expected to move forward, incorporating revised proposals to address regulatory concerns
The UK’s competition regulator, the Competition and Markets Authority (CMA), appears inclined to approve Microsoft’s $69 billion acquisition of Activision Blizzard, known for popular games like Call of Duty and World of Warcraft. Initially opposed in April over concerns about Microsoft’s potential dominance in the emerging cloud gaming sector, the deal faced obstacles. However, a revised proposal, including the sale of cloud gaming rights outside Europe to Ubisoft, has been deemed effective in addressing prior concerns, clearing the path for approval, as stated by the CMA on Friday.
The regulatory authority acknowledged “limited remaining reservations” related to potential loopholes, terminations, or non-enforcement concerning the sale of Activision’s cloud streaming rights. In response, Microsoft has proposed granting the CMA authority to enforce the terms of the rights sale, a measure the UK regulator sees as addressing its final concerns. Colin Raftery, the senior director of mergers at the CMA, emphasized that the altered agreement ensures the distribution of these crucial games via cloud remains with independent provider Ubisoft, safeguarding market structure and fostering open competition in the future of cloud gaming. Additionally, the agreement offers UK gamers various avenues to access Activision’s games, including through cloud-based multi-game subscription services.
The CMA has opened a consultation on the proposed solutions, with a conclusion set for October 6, before delivering a final decision on the deal’s approval. While the UK regulatory body appeared increasingly isolated in its opposition to the acquisition, counterparts in the EU approved the deal, and the US competition regulator’s attempt to halt it in court was unsuccessful. On Friday, the CMA criticized Microsoft for its delayed response in providing a viable remedy to competition concerns during the investigation. Microsoft aims for the CMA’s assessment of the revised deal to be concluded before the October 18 expiration of the acquisition agreement with Activision Blizzard, having extended the original deadline from July 18 to address regulatory concerns.