The European Union is not going to be looking into the new deal Microsoft has proposed in acquiring Activision Blizzard.
23.09.2023 - 05:55 / tech.hindustantimes.com / Brad Smith / Bobby Kotick / Sarah Cardell
British regulators on Friday dropped their objections to Microsoft's attempt to buy video game firm Activision Blizzard, the maker of "Call of Duty", paving the way for the US tech titan to close one of the biggest technology acquisitions ever.
Microsoft launched its blockbuster $69-billion takeover in January last year, an acquisition that would make it the world's third-largest gaming company by revenue, but it faced stiff scrutiny from US regulators and the UK's Competition and Markets Authority.
The CMA blocked the deal in April over fears it would damage competition in the fast-growing cloud gaming sector, where games are bought virtually and players can use a variety of devices rather than just consoles.
Microsoft eventually submitted a new bid that the CMA said in a statement on Friday had made important changes and "opens the door to the deal being cleared", adding that it would consult on the "remedies" before making a final decision.
Both the companies involved in the deal praised the CMA's change of heart.
Microsoft vice chairman and president Brad Smith, who had labelled the initial rejection in April as "probably the darkest day" of the firm's time in the UK, called Friday's statement a "positive development".
He saidMicrosoft would aim to get approval to close the deal by October 18.
Activision Blizzard CEO Bobby Kotick, whose company also makes the popular games "Diablo" and "Candy Crush", said the UK regulator's announcement was "a significant milestone for the merger".
Analysts said the takeover now looked like a shoo-in and all sides were able to claim victory -- the regulator showed its teeth and forced a concession and the firms got their deal over the line.
If the deal goes through, Microsoft will muscle in to form a "big three" in the sector -- just behind China's Tencent and Japan's Sony.
Microsoft, which makes the Xbox console and already has a stable of games under its belt including "Minecraft", "Elder Scrolls" and "Fallout", is already the dominant player in the cloud-gaming world -- its Game Pass service claims 25 million subscribers.
The original deal would have seen hugely popular Activision games including "Call of Duty", "Overwatch" and "World of Warcraft" added to its cloud roster, which was too much for the UK regulator to stomach.
Under the new deal, Microsoft has agreed it would not take control of the cloud portion of Activision's business, which will be transferred to French studio Ubisoft for 15 years.
CMA chief executive Sarah Cardell said Microsoft had taken the "necessary steps" but she added it would have been "far better" if the firm had made the proposal during the initial investigation.
"This case illustrates the costs, uncertainty and delay that parties can incur if a
The European Union is not going to be looking into the new deal Microsoft has proposed in acquiring Activision Blizzard.
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Unless the FTC's Lina Khan runs in at the last minute to physically tackle Bobby Kotick before he can sign anything, it's looking very likely that Microsoft's acquisition of Activision Blizzard will close in the very near future. I mean very near, you understand, as in possibly this Friday, pending word from the UK market regulator. But if you think that heralds the imminent arrival of games like Modern Warfare 3 and Diablo 4 on Microsoft's Game Pass service, Activision has news for you: It doesn't.
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«Ultimately, it's about bringing our development team's creative visions to life...»
We may be close to the end when it comes to all the regulation that has stopped the Microsoft – Activision deal from finalizing.
British regulators on Friday dropped their objections to Microsoft's attempt to buy video game firm Activision Blizzard, the maker of "Call of Duty", paving the way for the US tech titan to close one of the biggest technology acquisitions ever.
The United Kingdom's Competition and Markets Authority has issued a preliminary approval of the merger between Microsoft and Activision Blizzard, as they move into a consultation period and prepare to make a final decision. The CMA previously moved to block the deal last April, citing concerns that it would damage competition in the cloud gaming market, leading to less innovation and choice for UK gamers. In response, Microsoft restructured their proposal to divest cloud gaming rights of Activision Blizzard games to Ubisoft instead, who as an independent entity from Microsoft will replicate the role Activision would have played in the market as a standalone company.
In January 2022, Microsoft announced its intention to acquire Activision Blizzard for a whopping $68.7 billion. Since then, Microsoft has had to overcome several hurdles to get the deal approved in various regions. The UK has been one of the biggest obstacles, though it appears some important progress has been made.
UK regulator the Competition and Markets Authority (CMA) has provisionally approved Microsoft's acquisition of Activision Blizzard.