- 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
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.
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.
- All media enquiries should be directed to the CMA press office by email on press@cma.gov.uk, or by phone on 020 3738 6460.