UK approves Microsoft’s Activision acquisition

LONDON (AFP): British regulators on Friday approved Microsoft’s $69-billion takeover of Activision Blizzard, maker of the “Call of Duty” video game, paving the way for one the biggest technology tie-ups.

The Competition and Markets Authority said in a statement that it had cleared “the new deal for Microsoft to buy Activision without cloud gaming rights” after concluding “it would preserve competitive prices and better services”. Microsoft launched its blockbuster 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 regulators, including also in the United States.

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. But it dropped those objections last month ahead of its formal approval. “We’re grateful for the CMA’s thorough review and decision today,” Microsoft vice chair and president Brad Smith said Friday.

“We have now crossed the final regulatory hurdle to close this acquisition, which we believe will benefit players and the gaming industry worldwide.” 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. Aside from the concerns over cloud gaming, regulators had also worried that the initial deal would have allowed Microsoft to make Activision’s games exclusive to its Xbox.

Microsoft and Sony, which had previously tried to block the Activision deal, agreed in July to keep releasing “Call of Duty” on the PlayStation. The European Union cleared the deal in May while the US antitrust regulator recently paused its attempt to block the buyout following a setback in court.