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According to the UK’s competition watchdog, Microsoft’s updated bid to acquire Activision Blizzard, producer of the Call of Duty video game, “opens the door” to the transaction being approved.
The Competition Markets Authority (CMA) stated that it appeared that the revised agreement addressed its concerns.
Microsoft will not purchase Activision Blizzard’s cloud gaming rights under the current ideas.
Regulators in the UK rejected the original $69 billion (£59 billion) agreement.
The CMA barred Microsoft from acquiring the entirety of Activision earlier this year because of worries that the deal would hurt competition in cloud gaming in the UK.
The competition watchdog was then provided with a reworked contract by Microsoft last month.
In accordance with the new proposal, Microsoft consented to give French video game maker Ubisoft a 15-year license to stream Activision titles from the cloud.
This area of Activision’s company was sold to Ubisoft, so Microsoft won’t have any control over how games like Call of Duty, Overwatch, and World of Warcraft are streamed in the cloud.
“The CMA’s position has been consistent throughout – this merger could only go ahead if competition, innovation, and choice in cloud gaming were preserved,” the CMA’s chief executive, Sarah Cardell, said in a statement on Friday.
Before making a decision on the deal, a consultation will be started.
Controversial deal
This most recent development is going to be a huge relief for the executives at the top of Microsoft and Activision who worked tirelessly and at great cost to their reputations to close this agreement.
The initial announcement of Microsoft’s acquisition of Activision Blizzard, the largest takeover in video game history, came in January of last year.
Regulators from all around the world have had conflicting reactions to it, though, and it has proven to be contentious.
European Union officials approved the transaction in May, but a subsequent attempt by the US competition authority to halt it was rebuffed by an appeals court.
The takeover was on the edge of failing earlier this year, so it is a significant accomplishment that it is now close to being approved.
But in the CMA’s most recent announcement, Ms. Cardell stated, that Microsoft should have presented this reorganization during our initial examination. This case serves as an example of the expenses, ambiguity, and delays that parties may face if a viable and efficient remedy choice is available but is not made available at the appropriate time.
Sony initially opposed the arrangement as well, fearing that Microsoft may prevent popular games from being made available to its own PlayStation division.
According to the CMA, the change would give gamers the chance to access Activision’s games in a variety of ways, including through cloud-based multigame subscription services.
Although it still had “limited residual concerns,” it continued, the amended agreement retains control of these important games’ cloud distribution in the hands of a strong independent supplier, Ubisoft, rather than under Microsoft’s control.
This was “not a tweak,” Ms. Cardell said on the BBC‘s show, but rather a “fundamentally restructured deal.”
The deal closes the first “test case” for the CMA since it was given more authority following Brexit and provides insight into how competition laws may be used in the UK.
Microsoft continues to believe that the combination will increase interest in its Xbox gaming system and its gaming subscription service.
Brad Smith, its vice chairman and president, expressed that it was “encouraged” by this constructive move.
“We presented answers that, in our opinion, fully address the CMA’s unresolved concerns regarding cloud game streaming, and we will continue to work towards obtaining approval to close before the deadline of 18 October.”
After the consultation period ends on October 6th, Microsoft anticipates the CMA will make a final decision on the amended bid the following month. The agreement cannot be implemented internationally without its consent.
The preliminary approval, according to Activision, is “great news” for its future with Microsoft.
“We look forward to working with Microsoft towards completing the regulatory review process,” it continued.
The players may not immediately understand what all of this means. But now that Microsoft has acquired such a sizable portion of the gaming market, business planners and game developers within the corporation are considering what they can do with access to some of the greatest gaming properties.
Although there haven’t been any major announcements regarding what games or enhancements might come next, one expert told the BBC that the agreement put Microsoft in a “unique position.”
According to Gareth Sutcliffe, senior games analyst at Enders Analysis, Microsoft will be able to employ Activision’s team exclusively for mobile games.
In the end, it’s about providing every game imaginable with a single membership. Microsoft can now support all platforms, including PC, consoles, and smartphones.
While Microsoft hopes Activision maintains the success of its games like Candy Crush, he continued, “It’s all about the transfer of knowledge [from Activision’s team].”
The business’s declaration comes days after an unredacted document mistakenly made public during Microsoft’s legal dispute with US authorities appeared to indicate the corporation planned to introduce updated versions of its Xbox Series S and Series X consoles in 2024.
Although there were few specifics, one presentation slide that was leaked revealed plans for a new next-generation system in 2028.
Additionally, an old memo that suggested Nintendo had once been considered by Microsoft as a prospective acquisition was included, albeit this would have been prior to any Activision bid becoming public.
Credits: BBC
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