Microsoft Corp has received approval from the UK Competition and Markets Authority (CMA) for its $69 billion acquisition of Activision Blizzard Inc, marking a significant milestone in completing the largest gaming deal to date. The CMA stated on Friday that Microsoft’s revised offer, which involved the sale of gaming rights to Ubisoft Entertainment SA, addressed all competition concerns and would ensure competitive prices and improved services for consumers.
The acquisition had faced obstacles from global antitrust regulators, including an initial rejection from the UK. However, Microsoft gained momentum after successfully overcoming a legal challenge from the Federal Trade Commission and obtaining clearance from the European Union with certain behavioral remedies. This left the CMA as the remaining regulatory hurdle.
Sarah Cardell, CEO of the CMA, emphasized that Microsoft had to address their concerns comprehensively to prevent the deal from being blocked. Microsoft subsequently submitted a significantly modified proposal to the CMA during the summer, with the aim of including popular title Call of Duty in the deal. The deadline for finalizing the agreement was extended to October 18 after mutual agreement between Microsoft and Activision.
Brad Smith, Microsoft’s Vice Chair and President, expressed their excitement at overcoming the final regulatory hurdle, highlighting the belief that the acquisition would benefit players and the gaming industry worldwide. Once the deal is complete, Microsoft will assume control over renowned gaming franchises such as Call of Duty, Candy Crush, and Diablo.
In recent years, Microsoft has actively purchased game companies in an effort to bring top games to its gaming ecosystem, including Xbox consoles, Windows PCs, and the Game Pass subscription service. Despite currently trailing behind Sony and Nintendo, Microsoft executives view this acquisition as an opportunity to establish a strong presence in the $93 billion mobile gaming market. However, UK regulators were primarily concerned about Microsoft’s potential dominance in the emerging cloud gaming market rather than mobile gaming.
By incorporating Activision’s games, Microsoft hopes to attract more customers to its cloud gaming service, a feature offered through Game Pass. Cloud gaming, despite its niche status, remains a target for tech giants such as Google and Amazon, who have faced challenges in gaining a foothold in the sector.
The European Union stated that the revised deal did not require further approval in Brussels. The European Commission also confirmed that the commitments made by Microsoft in the UK would not interfere with its operations within the EU.
Although the deal is likely to proceed despite ongoing resistance from the Federal Trade Commission, the agency intends to pursue an in-house trial against the acquisition after it concludes.
While the CMA identified limited residual concerns with the new deal, Microsoft provided assurances that enforceable measures would be implemented regarding the rights sold to Ubisoft, satisfying the CMA’s requirements.
An Activision spokesperson welcomed the CMA’s official approval, expressing anticipation for the company’s future as part of the Xbox Team.