Microsoft has successfully finalized its acquisition of Activision Blizzard, creators of Call of Duty. UK regulators have given the green light to the global deal after earlier concerns.
Microsoft has successfully finalized its acquisition of Activision Blizzard, creators of Call of Duty. UK regulators have given the green light to the global deal after earlier concerns.
The Competition and Markets Authority (CMA) stated that their worries have been addressed, leading to the approval of the acquisition after an initial block. Phil Spencer, of Microsoft, expressed his excitement at securing Activision Blizzard.
Activision Blizzard CEO Bobby Kotick confirmed his intention to step down at the end of 2023 in a letter to staff following the announcement. He emphasized a commitment to aiding with the transition and looked forward to collaborating on a seamless integration.
Despite concerns raised by rivals and regulators, Phil Spencer assured gamers that regardless of their preferred platform, be it Xbox, PlayStation, Nintendo, PC, or mobile, they are welcome. Spencer stated, “Because when everyone plays, we all win. We believe our news today will unlock a world of possibilities for more ways to play.”
Under the revised deal, Microsoft has granted distribution rights of Activision’s games on consoles and PCs over the cloud to French video game publisher Ubisoft. However, Microsoft now has control over major titles like Call of Duty, World of Warcraft, and Candy Crush, promising substantial revenues.
The CMA noted that this adjusted deal would uphold competitive prices in the gaming industry and provide greater choice and improved services. Nevertheless, the CMA criticized Microsoft’s conduct during the nearly two-year-long process, stating that such tactics are not how businesses should engage with them.
Microsoft’s president Brad Smith previously criticized the CMA’s initial block, asserting that it was “bad for Britain” and contradicted the UK’s aspirations to be a tech-friendly country. The acquisition, which has been met with mixed responses from regulators worldwide, has already received approval from the European Union. The US competition watchdog’s attempt to pause the purchase was recently rejected by the courts.
Microsoft is set to pay cash for Activision Blizzard, creators of Call of Duty at a premium price of $95 per share. This means outgoing CEO Bobby Kotick stands to receive a $400 million payday, with chairman Brian Kelly earning $100 million based on their shareholdings.
In a restructured agreement, Microsoft will transfer the rights to stream Activision games from the cloud to Ubisoft for 15 years outside the European Economic Area. After this period, Ubisoft will no longer hold cloud gaming rights for Activision’s content. Microsoft anticipates that the acquisition will boost demand for its Xbox console and expand its Xbox Game Pass service.
This monumental takeover solidifies Microsoft’s status as a video game giant, potentially propelling it ahead of Nintendo to become the third-largest player in the industry, trailing only Sony and market leader Tencent. Sony had strongly opposed the deal out of concerns that major Activision titles might eventually become Xbox exclusives.
Former commercial director of cloud services provider UK Cloud, Nicky Stewart, hailed the approval as “great news for gamers,” predicting it will lead to more choice, innovation, better value, and enhanced gaming experiences. The CMA’s insistence on concessions within the UK has been lauded as a positive development for the country’s emerging gaming industry.