By Gary Symons
TLL Editor in Chief
Microsoft has completed its $69 billion deal to acquire video gaming giant Activision Blizzard, after reaching an agreement with regulators in the UK.
The months long battle to complete the controversial deal was finally won after Microsoft made concessions that the Competition and Markets Authority said were “game changing.”
The CMA, which is responsible for ensuring industry remains competitive in the UK, had blocked the deal back in April this year. It said Microsoft, which produces the Xbox gaming console, would be able to unfairly dominate the growing cloud gaming market if it acquired Activision.
Martin Coleman, the chair of the independent panel of experts who conducted the CMA investigation, said the deal as originally structured had the potential to harm consumers and stifle competition.
“Gaming is the UK’s largest entertainment sector,” Coleman pointed out. “Cloud gaming is growing fast with the potential to change gaming by altering the way games are played, freeing people from the need to rely on expensive consoles and gaming PCs, and giving them more choice over how and where they play games. This means that it is vital that we protect competition in this emerging and exciting market.
“Microsoft already enjoys a powerful position and head start over other competitors in cloud gaming and this deal would strengthen that advantage giving it the ability to undermine new and innovative competitors,” Coleman concluded.
In September, however, the CMA announced Microsoft and Activision had revised the deal, including an agreement to sell their cloud gaming rights outside of Europe to Activision’s French rival Ubisoft. The regulator said that change substantially addressed its primary concerns. The CMA confirmed approval of the deal on Friday and Microsoft announced it had completed the transaction hours later in a regulatory filing.
CMA chief executive Sarah Cardell, said the agreement is a win for consumers around the world.
“As cloud gaming grows, this intervention will ensure people get more competitive prices, better services and more choice,” Cardell said.
The CMA said Microsoft’s concessions on cloud gaming would allow Ubisoft to offer multi-game subscription services, and ensure that cloud gaming services could use non-Windows operating systems for Activision content. It would also prevent Activision titles from being offered exclusively on the Microsoft-owned Xbox Cloud Gaming service, which should act to keep prices competitive.
While Microsoft was extremely critical of the CMA after is decision in April, the tech giant now appears pleased with the end result.
“Together, we’ll create new worlds and stories, bring favorite games to more places so more players can join in, and we’ll engage with and delight players in new, innovative ways in the places they love to play including mobile, cloud streaming and more,” Microsoft said in a statement, while the CEO of Microsoft Gaming, Phil Spencer, added in an X post, “Today is a good day to play.”
Spencer previously said the acquisition is important for Microsoft as it will allow the company to strongly compete in the $90 billion market for mobile games. In addition to its popular PC and console games like Call of Duty and Diablo, Activision makes popular mobile titles including Candy Crush Saga and Call of Duty: Mobile, among many others.
While the deal is complete, it’s not completely out of the woods just yet.
The US Federal Trade Commission (FTC) is maintaining its opposition to the deal but was unable to prevent Microsoft and Activision from completing it. Legal experts have generally concluded the FTC is unlikely to be able to unravel the deal now it’s completed. The FTC said on Friday it was focused on its appeal but would “assess” Microsoft’s agreement with Ubisoft.
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