December 3, 2023

Brighton Journal

Complete News World

The acquisition of Microsoft-Activision Blizzard has been approved by the British regulatory body CMA

The acquisition of Microsoft-Activision Blizzard has been approved by the British regulatory body CMA

The Microsoft logo is seen on a smartphone displayed over the Activision Blizzard logo in this illustration taken on January 18, 2022.

Dado Rovik | Reuters

Britain’s top competition watchdog gave the green light on Friday To Microsoft It offered to take over a gaming company worth $69 billion Activision Blizzardremoving the last major hurdle to closing the deal.

The Competition and Markets Authority said it had approved Microsoft’s purchase of Activision, but without the cloud gaming rights.

“The new deal will prevent Microsoft from locking in competition in cloud gaming as this market takes off, while maintaining competitive prices and services for UK cloud gaming customers,” the regulator said in a statement on Friday.

The Capital Market Authority was the final regulatory body to halt the deal. Microsoft should now be able to close the acquisition.

The decision represents a major shift from the Capital Markets Authority, the takeover’s harshest critic, which effectively blocked the deal earlier this year over concerns that the takeover would hamper competition in the emerging cloud gaming market.

Microsoft first proposed acquiring Activision in January 2022, but has since faced regulatory challenges in the US, Europe and the UK.

In July, the Capital Markets Authority said it would consider a restructured takeover from Microsoft to allay its concerns. Microsoft made a series of concessions, centered around divesting the cloud rights to Activision games to French game publisher Ubisoft Entertainment.

“It will allow Ubisoft to deliver Activision content under any business model, including through multiple game subscription services. It will also help ensure cloud gaming providers are able to use non-Windows operating systems for Activision content, reducing costs and increasing efficiency,” the markets authority said. the money.

See also  Apple's new iPad is on sale for the first time at $50 off

The regulatory turn in the United Kingdom

Regulators globally were concerned that the acquisition would reduce competition in the gaming market, particularly regarding cloud gaming. Microsoft could also take key Activision games like Call of Duty and make them exclusive to Xbox and other Microsoft platforms, officials said.

Cloud gaming is seen as the next frontier for the industry, offering subscription services that allow people to stream games just like they would movies or shows on… Netflix. It could also eliminate the need for expensive consoles, with users playing games on PCs, mobile phones and televisions instead.

Specifically, the UK regulator argued when it blocked the takeover in April that allowing the deal to go ahead would give Microsoft a strong position in the emerging cloud gaming market.

Authorities in the European Union were the first major regulator to approve the deal in May, after Microsoft offered concessions to the European Union.

At the time, the CMA said it stood by its initial decision to block the deal because the concessions made to the EU would allow Microsoft to “set the terms and conditions for this market for the next ten years.”

Meanwhile, in the United States, the Federal Trade Commission was locked in a legal battle with Microsoft in an attempt to cancel the Activision acquisition. But in July, a judge blocked the FTC’s attempt to do so, clearing the way for the deal to go ahead in the United States.

Just hours later, the Capital Markets Authority said it was “ready to consider any proposals from Microsoft to restructure the deal” and allay the regulator’s concerns.

See also  Final Fantasy VII Day is officially registered with the Japan Anniversary Association

Microsoft cedes to the United Kingdom

In August, Microsoft offered concessions to the Capital Markets Authority in its second attempt to complete the deal.

Under the restructured deal, Microsoft will not acquire the cloud rights to existing Activision PC and console games, or to new games released by Activision within the next 15 years. Instead, those rights will be transferred to Ubisoft Entertainment prior to Microsoft’s acquisition of Activision, according to the CMA.

“By selling Activision’s cloud streaming rights to Ubisoft, we have ensured that Microsoft will no longer be able to dominate this important and rapidly evolving market,” CMA CEO Sarah Cardell said in a statement.

“As cloud gaming grows, this intervention will ensure that people get more competitive prices, better services and more choice. We are the only competition agency globally to achieve this result.”

While the UK approved the deal, the Capital Markets Authority, which has become increasingly aggressive in its scrutiny of large mergers, fired a parting shot at Microsoft, criticizing the tech giant’s negotiating tactics.

“Companies and their advisors should be in no doubt that the tactics being used by Microsoft are not the way to deal with the CMA,” Cardell said.

“Microsoft had the opportunity to restructure during our initial investigation, but instead continued to insist on a set of actions that we told them simply would not work. Delaying actions in this way only wastes time and money.”

‘The last regulatory hurdle’