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The new deal for Microsoft to buy Activision without cloud gaming rights has been cleared after the CMA concluded it would preserve competitive prices and better services.

In August this year Microsoft made a concession that would see Ubisoft, instead of Microsoft, buy Activision’s cloud gaming rights. This new deal will put the cloud streaming rights (outside the EEA) for all of Activision’s PC and console content produced over the next 15 years in the hands of a strong and independent competitor with ambitious plans to offer new ways of accessing that content.

...

The new deal will stop Microsoft from locking up competition in cloud gaming as this market takes off, preserving competitive prices and services for UK cloud gaming customers. It will allow Ubisoft to offer Activision’s content under any business model, including through multigame subscription services. It will also help to ensure that cloud gaming providers will be able to use non-Windows operating systems for Activision content, reducing costs and increasing efficiency.

Sarah Cardell, Chief Executive of the CMA said:

The CMA is resolute in its determination to prevent mergers that harm competition and deliver bad outcomes for consumers and businesses. We take our decisions free from political influence and we won’t be swayed by corporate lobbying.

We delivered a clear message to Microsoft that the deal would be blocked unless they comprehensively addressed our concerns and stuck to our guns on that.

With the sale of Activision’s cloud streaming rights to Ubisoft, we’ve made sure Microsoft can’t have a stranglehold over this important and rapidly developing market. As cloud gaming grows, this intervention will ensure people get more competitive prices, better services and more choice. We are the only competition agency globally to have delivered this outcome.

But businesses and their advisors should be in no doubt that the tactics employed by Microsoft are no way to engage with the CMA. Microsoft had the chance to restructure during our initial investigation but instead continued to insist on a package of measures that we told them simply wouldn’t work. Dragging out proceedings in this way only wastes time and money.

Martin Coleman, Chair of the Independent Panel who reviewed the original Microsoft deal, said:

Cloud gaming is an important new way for gamers to access games and this deal could have seriously undermined its potential development. On that we, the European Commission and the US Federal Trade Commission are in full agreement. Where we differ is on how we solve that problem. We rejected a solution put to us by the parties which would have left Microsoft with too much control.

We now have a new transaction in which the cloud distribution of Activision games, old and new, is taken away from Microsoft and put into the hands of Ubisoft, an independent party who is committed to widening access to the games. That’s better for competition, better for consumers and better for economic growth.

In its original investigation, the CMA found Microsoft already held a strong position in relation to cloud gaming and blocked the deal.

The sale of Activision’s cloud streaming rights to Ubisoft will prevent the distribution of important, popular content – including games such as Call of Duty, Overwatch, and World of Warcraft – from coming under the control of Microsoft in relation to cloud gaming. The restructured deal substantially addressed the concerns that the CMA had following its original investigation, which concluded earlier this year.

The CMA did identify limited residual concerns with the new deal, but Microsoft gave undertakings that will ensure that the terms of the sale of Activision’s rights to Ubisoft are enforceable by the CMA.

The CMA consulted on these undertakings and is satisfied that this will provide the safety net needed to make sure this deal is properly implemented.

Microsoft concession a gamechanger that will promote competition

The new deal for Microsoft to buy Activision without cloud gaming rights has been cleared after the CMA concluded it would preserve competitive prices and better services.

www.gov.uk

I thought this would provide more insight as to how and why CMA (Competition and Markets Authority) cleared the acquisition. This was CMAs statement on Friday.

 

[Bumblebeetuna]

Cloud gaming control was the concession?

 

[DryvBy]

I don't care what an article says. Consolidation does not bring competition. Microsoft buying studios to remove games from platforms doesn't give us more competition. If that brings competition then naturally buying 6 months of a game like Sony does (and ironically, MS does) should also bring competition.

 

[IFireflyl]

This provided no new insight. The CMA buckled under Microsoft's pressure. They had already blocked the deal, and in a unprecedented move they decided to reverse course and accept a new agreement via backroom discussions. I can't think of another time in the CMA's history where they have done this. While they did get some concessions out of Microsoft, this was just another example of how big tech rules the world.

 

[Danknugz]

MS laughs to the bank cause no judges understand no one plays CoD on cloud based on the way the game works

 

[Ass of Can Whooping]

The day of reckoning is coming Sarah. You'll come to regret your mistakes.

 

[BennyBlanco]

This provided no new insight. The CMA buckled under Microsoft's pressure. They had already blocked the deal, and in a unprecedented move they decided to reverse course and accept a new agreement via backroom discussions. I can't think of another time in the CMA's history where they have done this. While they did get some concessions out of Microsoft, this was just another example of how big tech rules the world.

MS proved these agencies shouldn’t even exist. FTC has been a joke for a long time, letting Disney go on a fucking rampage over the last decade or so and all those telecom mergers. All these agencies do is sniff their own farts and waste tax money.

 

[Dream-Knife]

MS proved these agencies shouldn’t even exist. FTC has been a joke for a long time, letting Disney go on a fucking rampage over the last decade or so and all those telecom mergers. All these agencies do is sniff their own farts and waste tax money.

Disney wrote our copywrite laws after all.

 

[graywolf323]

the concession didn’t even really address their original concerns about wanting something permanent & not needing to police the deal…

 

[Kerotan]

MS laughs to the bank cause no judges understand no one plays CoD on cloud based on the way the game works

Yeah they are easily fooled.

 

[Rykan]

I don't care what an article says. Consolidation does not bring competition. Microsoft buying studios to remove games from platforms doesn't give us more competition. If that brings competition then naturally buying 6 months of a game like Sony does (and ironically, MS does) should also bring competition.

What AB games are being pulled from other platforms?

 

[adamsapple]

If Sarah is happy, I'm happy.

 

[ElCasual]

Promote the monopoly.

 

[mansoor1980]

get rich sarah...................

 

[Fabieter]

the concession didn’t even really address their original concerns about wanting something permanent & not needing to police the deal…

Ding ding ding. No lobbying my ass.

 

[Badlucktroll]

 

[C2brixx]

This is a pretty weak concession considering the future is native console quality gaming on mobile devices. Even when internet speeds get faster that would just make it more convenient to download the game to your device for a higher quality native experience.

 

[sinnergy]

Nice spinning

 

[Horseganador]

Spending 80 billion on kidnapping multiplatform companies to take away your rival's games promotes monopoly, but certainly NOT competition.

 

[Banjo64]

The fact they have to comment on this further to their final decision proves they know the optics are appalling.

 

[Elios83]

Sarah should comment on why they were shaking at the idea of facing the appeal with the CMA and they conceded a second chance to the deal, something that I don't think has ever happened.
So much for not bowing to pressure and lobbying.

Anyway they blocked the deal based on cloud market concerns, they divested the rights to a third party company, it was hard to justify the remedy wasn't effective.
The shady part is why they didn't defend the original decision in court.

 

[ZoukGalaxy]

Microsoft ? Competition ?

We have almost 3 decades of Windows monopole and anti-competitive practices

 

[ABnormal]

I thought that competition was based on skill and price.
So now, even if you are an inept and you are not able to create anything of value which would make you competitive through skill, if you have the money to just buy the market itself, you can magically become "competitive", while remaining inept to add anything meaningful to the market.

 

[Faust]

Buying studios does not create competition. Creating great games does.

 

[Ozriel]

This provided no new insight. The CMA buckled under Microsoft's pressure. They had already blocked the deal, and in a unprecedented move they decided to reverse course and accept a new agreement via backroom discussions. I can't think of another time in the CMA's history where they have done this. While they did get some concessions out of Microsoft, this was just another example of how big tech rules the world.

They blocked the deal due to Cloud concerns. They CLEARLY stated the reason why the block happened. We had a big thread on GAF when that happened and the reason was provided in the title. With MS structurally divesting themselves of the cloud rights, those objections were no longer necessary.

This isn't about 'reversing course'. They blocked an attempt by MS to get it passed after they won the FTC case. This is the CMA sticking to their guns and forcing MS into significant concessions.

the concession didn’t even really address their original concerns about wanting something permanent & not needing to police the deal…

I'm not sure how you can argue this with a straight face. They didn't want to police a behavioral remedy. This is considered a structural remedy, and backed by a legally binding rights transfer to Ubisoft who will themselves ensure the agreements are held to.

The fact they have to comment on this further to their final decision proves they know the optics are appalling.

This article was written October 13th and was the medium they used to communicate their decision. They certainly aren't 'commenting on it further'.

 

[ChuckeRearmed]

MS proved these agencies shouldn’t even exist. FTC has been a joke for a long time, letting Disney go on a fucking rampage over the last decade or so and all those telecom mergers. All these agencies do is sniff their own farts and waste tax money.

It will be hilarious if the current FTC approves Kroger/Albertsons (though I believe DOJ is responsible for that) because they were incompetent enough not being able to build a proper case against it.

 

[U n i o n 0015]

This provided no new insight. The CMA buckled under Microsoft's pressure. They had already blocked the deal, and in a unprecedented move they decided to reverse course and accept a new agreement via backroom discussions. I can't think of another time in the CMA's history where they have done this. While they did get some concessions out of Microsoft, this was just another example of how big tech rules the world.

Wouldn't doubt someone from the CMA ends up with a cushy MSFT job a few years down the road. This is how legalized bribery (aka lobbying) works.

 

[HoofHearted]

Gotta sell that “win” no matter what - You be you Sarah!

 

[ShadyAcshuns]

Cardell and the CMA are both full of shit. They lost, but are pretending they won. What a bunch of jokers.

 

[James Sawyer Ford]

In 10 years this concession will be forgotten and MS won't even obey it.

The regulators will look like a complete joke

 

[Insane Metal]

Competition with Microsoft. Yeah sure.

 

[Meicyn]

This is a pretty weak concession considering the future is native console quality gaming on mobile devices. Even when internet speeds get faster that would just make it more convenient to download the game to your device for a higher quality native experience.

Yuuuup. Giving cloud streaming to Ubisoft was an easy give away. Look at Microsoft’s own internal numbers, even they know cloud isn’t the future. The real heist was in the portfolio they now own.

 

[Deerock71]

Microsoft just sold them a piece of pie in the sky. History repeats itself.

 

[IFireflyl]

They blocked the deal due to Cloud concerns. They CLEARLY stated the reason why the block happened. We had a big thread on GAF when that happened and the reason was provided in the title. With MS structurally divesting themselves of the cloud rights, those objections were no longer necessary.

This isn't about 'reversing course'. They blocked an attempt by MS to get it passed after they won the FTC case. This is the CMA sticking to their guns and forcing MS into significant concessions.



I'm not sure how you can argue this with a straight face. They didn't want to police a behavioral remedy. This is considered a structural remedy, and backed by a legally binding rights transfer to Ubisoft who will themselves ensure the agreements are held to.



This article was written October 13th and was the medium they used to communicate their decision. They certainly aren't 'commenting on it further'.

Don't talk to me like I'm stupid. The reversing course was the block. They did block the acquisition, and they also implemented a 10-year clause that prevented reattempting the acquisition. Then, due to backroom deals that were supposed to be made BEFORE the CMA rendered its final decision, the CMA reversed course and unblocked the deal with a new deal to take its place.

Give me one other example in the history of the CMA where they rendered their final decision, and then on an appeal process they came to an agreement behind-the-scenes instead of letting the appeal process come to a close.

I know what I'm talking about. You're just defending your favorite trillion-dollar corporation.

 

[adamsapple]

Don't talk to me like I'm stupid. The reversing course was the block. They did block the acquisition, and they also implemented a 10-year clause that prevented reattempting the acquisition. Then, due to backroom deals that were supposed to be made BEFORE the CMA rendered its final decision, the CMA reversed course and unblocked the deal with a new deal to take its place.

Give me one other example in the history of the CMA where they rendered their final decision, and then on an appeal process they came to an agreement behind-the-scenes instead of letting the appeal process come to a close.

I know what I'm talking about. You're just defending your favorite trillion-dollar corporation.

To be fair, the original deal was and still is blocked, this is a new proposal and new submission that was approved. They did not revert back their original decision.

 

[Flutta]

So how much did MS give you Sara?

 

[DryvBy]

What AB games are being pulled from other platforms?

Are you special or something?

 

[Black_Stride]

Wait does Ubisoft+ streaming even still exist?
I thought all they did was put their games on Luna.....if Ubisoft+ and Activision games are still part of xCloud does it even really matter?

 

[semiconscious]

MS proved these agencies shouldn’t even exist. FTC has been a joke for a long time, letting Disney go on a fucking rampage over the last decade or so and all those telecom mergers. All these agencies do is sniff their own farts and waste tax money.

yeah, right. next you'll be telling me that the fda is funded by pfizer... oh, wait:

https://theconversation.com/why-is-the-fda-funded-in-part-by-the-companies-it-regulates-160444

 

[DrFigs]

Wait does Ubisoft+ streaming even still exist?
I thought all they did was put their games on Luna.....if Ubisoft+ and Activision games are still part of xCloud does it even really matter?

It's not really clear what Ubisoft's role would be in this relationship... I guess they'd be responsible for marketing the streaming versions?

 

[SABRE220]

Yeah sure Sarah...money talks and this was a brutal example of how corpos can literally intimidate even the strongest regulatory bodies into submission.

Microsoft's lobbying prowess is so potent that the freaking prime minister of the UK started sweating at ruining relations with MS and he came out in support of Microsoft due to its influence in the country's cyber security and he actually started criticizing his own nation's regulatory body....watching CMA falling over themselves to get the deal approved even without receiving the details of the revised offer was revolting...even the judge was bewildered by what was going on but after a few phonecalls he became very compliant as well.

The government had a chance to get them under control a decade back but megacorps have officially won and are beyond reproach, we are literally heading onto the path of cyberpunk (arasaka etc) in a few decades.

 

[nemiroff]

"When cloud gaming takes off"

 

[Phase]

I'm taking a break from this site. It's become just a corporate news dump spot and I'm sick of it.

 

[recursive]

It's not really clear what Ubisoft's role would be in this relationship... I guess they'd be responsible for marketing the streaming versions?

Well they will probably be Microsoft's next conquest. Microsoft is playing 4D chess while the regulators are still learning tic tac toe.

 

[IFireflyl]

To be fair, the original deal was and still is blocked, this is a new proposal and new submission that was approved. They did not revert back their original decision.

That isn't fair at all. Did you read my post? The original deal was blocked and had an additional clause that the acquisition couldn't be reattempted for a decade. The fact that this deal went through means that the CMA undid their original decision. This is unprecedented.

 

[Rykan]

Are you special or something?

Why, were there any AB games announced to be pulled off other platforms that I missed?

 

[HeWhoWalks]

Why, were there any AB games announced to be pulled off other platforms that I missed?

You're missing the point. They've already pulled IPs from other platforms as they continue to consolidate the industry one publisher at a time. So far, we only know of CoD regarding this deal (and that had specific stipulations). What's stopping them from pulling the other ABK properties from other platforms?

 

[near]

That isn't fair at all. Did you read my post? The original deal was blocked and had an additional clause that the acquisition couldn't be reattempted for a decade. The fact that this deal went through means that the CMA undid their original decision. This is unprecedented.

This is not true at all. CMA prevented the deal after Microsoft's proposals failed to address concerns in cloud gaming. CMA then stipulated requirements governing what games they must offer subject to the merger on conditions over a 10 year period. This concession is over a 15 year period.

 

[Rykan]

You're missing the point. They've already pulled games from other platforms as they continue to consolidate the industry one publisher at a time. So far, we only know of CoD regarding this deal. What's stopping them from puling the other ABK properties from other platforms?

I'm not missing the point, I'm sticking to the actual observable facts. No AB games have been announced to be “Pulled” from other platforms. Call of Duty is staying Multiplatform. Every single Blizzard game is a live service game, and those are definitely staying multiplatform. What AB games are we supposed to be concerned about being pulled from other platforms? An unannounced Crash Bandicoot 5? Come on now.

 

[HeWhoWalks]

I'm not missing the point, I'm sticking to the actual observable facts. No AB games have been announced to be “Pulled” from other platforms. Call of Duty is staying Multiplatform. Every single Blizzard game is a live service game, and those are definitely staying multiplatform. What AB games are we supposed to be concerned about being pulled from other platforms? An unannounced Crash Bandicoot 5? Come on now.

I already explained how you missed his point. Until we hear of the other properties, and considering history, it isn't unreasonable to assume more IPs will become exclusives.

COD also has a duration. 15 years. There's nothing to "come on" to. History shows that Microsoft will happily pull IPs from other platforms should the opportunity arise. That was his point.