- Deal to buy Activision without cloud gaming rights cleared by
CMA
- Ubisoft acquiring rights instead of Microsoft addresses CMA
concerns
- CMA holding firm preserves competitive prices and better
services in cloud gaming
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.
As a result of this concession, the CMA agreed to look afresh at
the deal and launched a new investigation in August. That
investigation has completed today with the CMA clearing this
narrower transaction.
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.
The decision
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.
For more information, visit the Microsoft / Activision
ex-cloud streaming rights case page.
Notes to editors:
- The full timeline of the CMA’s investigation into the
original transaction
(Phase 1 and 2) is available.
