Microsoft is significantly restructuring its Activision Blizzard merger proposal by selling the cloud gaming rights for Activision Blizzard games to rival Ubisoft, it wrote in a blog post last night. It would address a key concern from UK regulators, who have blocked the deal in part due to Microsoft’s potential dominance in cloud gaming – but nothing is expected to be approved until October 18.
“Following the agreement with Ubisoft, Microsoft believes that its proposed acquisition of Activision Blizzard presents a materially different transaction under UK law than the transaction that Microsoft submitted for CMA review in 2022” , wrote Microsoft President Brad Smith.
If the merger goes through, Microsoft would transfer “cloud streaming rights for all current and new Activision Blizzard PC and console games released over the next 15 years to Ubisoft Entertainment SA, one of the world’s leading game publishers. The rights will be in perpetuity,” Smith said. added. That means Microsoft wouldn’t be able to make Activision Blizzard games exclusive to Xbox Cloud Gaming, or have any say in how they’re published on competing services. It will also allow Ubisoft to offer Activision Blizzard cloud gaming services on Apple and other non-Windows systems.
Regarding the terms of the transaction, “Ubisoft will compensate Microsoft for cloud streaming rights to Activision Blizzard games through a one-time payment and through a market-based wholesale pricing mechanism, including an option that takes charges usage-based pricing,” Smith said.
The Ubisoft+ range is growing!
We’re excited to announce a new deal that will bring Activision Blizzard games to Ubisoft+ via streaming following Microsoft’s acquisition of Activision Blizzard!
We will also be licensing the games to a range of cloud streaming services… pic.twitter.com/sZTnEFJedC
— Ubisoft (@Ubisoft) August 22, 2023
In its own blog post, Ubisoft indicated that Activision Blizzard titles will be available on a range of services if the deal goes through. “With a single subscription to Ubisoft+ Multi Access, gamers will soon be able to play their favorite Ubisoft and Activision Blizzard games on multiple platforms, including PC, Xbox consoles and Amazon Luna, and on the PlayStation platform through Ubisoft+ Classics” , wrote Daniel O of Ubisoft. ‘Connor.
The UK’s Competition and Markets Authority (CMA) blocked the proposed merger earlier this year, citing cloud gaming monopoly issues as the main problem. However, after the US Federal Trade Commission (FTC) lost its own appeal to block the merger, the CMA agreed to extend negotiations until August 29. “Based on discussions to date, both parties — Microsoft and the CMA — are satisfied that Microsoft notifying a restructured transaction is capable of addressing the concerns identified by the CMA,” the CMA said in July.
The UK regulator will now review the restructured deal and make a decision by October 18, it said in a post today. “This is not a green light. We will carefully and objectively assess the details of the restructured agreement and its impact on competition, including in light of third-party comments,” CMS Chief Executive Sarah Cardell said. . “Our focus has not changed – any future decisions on this new agreement will ensure that the growing cloud gaming market continues to benefit from open and effective competition that drives innovation and choice.”
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