Microsoft cleared to buy Call of Duty maker Activision Blizzard

UK regulators have granted approval for Microsoft’s revised offer to acquire Activision Blizzard, the creators of Call of Duty. This decision marks the conclusion of a nearly two-year-long battle to secure the largest-ever takeover in the gaming industry. Despite granting approval for the takeover, the Competition and Markets Authority (CMA) has criticized Microsoft’s behavior during the process.

In the reworked deal, Microsoft will transfer the rights to distribute Activision’s games via cloud technology to French video game publisher Ubisoft. Nevertheless, Microsoft will retain control over popular games such as Call of Duty, World of Warcraft, and Candy Crush, which generate substantial revenue for the company.

The CMA has indicated that the revised deal, which allows the global finalization of the transaction, will help maintain competitive prices in the gaming industry and provide consumers with more choices and improved services. While this deal has generated mixed responses from regulators worldwide, it has already received approval from the European Union, and the attempt by the US competition watchdog to halt the purchase was recently rejected by the courts.

The CMA’s Chief Executive, Sarah Cardell, emphasized that the sale of Activision’s cloud streaming rights to Ubisoft ensures that Microsoft won’t have a stranglehold over this vital and rapidly evolving market. She also affirmed the CMA’s independence and resistance to corporate lobbying.

Microsoft’s President, Brad Smith, expressed gratitude for the CMA’s thorough review and decision, considering it the final regulatory hurdle to complete the deal. Activision Blizzard also welcomed the approved deal.

As part of the restructured agreement, Microsoft will transfer the rights to stream Activision games from the cloud to Ubisoft for 15 years outside the European Economic Area (EEA). After this period, Ubisoft will no longer hold these rights, as the regulator believes that the competitive cloud gaming market will have more established rivals by then.

Microsoft hopes that this acquisition will boost demand for its Xbox console and expand its Xbox Game Pass service, which offers a subscription-based catalog of games accessible through downloading or streaming. It also gives Microsoft ownership of a studio focused on mobile games, building on the success of titles like Candy Crush.

This takeover solidifies Microsoft’s position as a major player in the gaming industry and could position it as the third-largest player, behind Sony (PlayStation) and Tencent (market leader). Sony expressed concerns that key Activision titles could become Xbox exclusives over time.

In summary, the UK regulators have approved Microsoft’s revised acquisition of Activision Blizzard, marking the end of a lengthy battle to secure this significant takeover in the gaming industry. The deal is expected to have a substantial impact on the gaming industry, making Microsoft a major player and potentially affecting the dynamics of console competition and exclusive titles.