Microsoft rejigs $69B Activision Blizzard deal to placate UK regulators, offers all cloud gaming rights to Ubisoft for 15 years

Microsoft Activision Blizzard logos
(Image credit: Anadolu Agency (Getty Images))

Microsoft has made a new offer, one that president Brad Smith describes as a "substantially different transaction", in its effort to get its proposed $69 billion acquisition of Activision Blizzard over the finish line with the United Kingdom's Competition and Markets Authority. The CMA had previously blocked the deal on grounds that included concerns about the nascent cloud gaming market, and the restructured deal will see all cloud rights to Activision Blizzard games signed over to Ubisoft for the next 15 years.

The CMA says it will review the new offer, but cautioned "this is not a green light." It is to deliver a decision by October 18. This comes after the EU Commission has approved the deal, joining many other global regulatory bodies, and following the US Federal Trade Commission's failure to block the deal in the courts (these efforts continue, though the chances of the decision being reversed are remote). While the CMA and the UK may seem like small beer in a global context, the fact is the deal cannot proceed as-is without the CMA's approval.

Microsoft's new offer will see streaming rights to all Activision Blizzard games published in the next 15 years transferred to Ubisoft, with those rights held by Ubisoft in perpetuity. "Microsoft will not be in a position either to release Activision Blizzard games exclusively on its own cloud streaming service—Xbox Cloud Gaming—or to exclusively control the licensing terms of Activision Blizzard games for rival services," said Brad Smith.

This is all rather nicer than Smith's comments when the CMA initially blocked the deal, when the suit wailed about Microsoft's "darkest day" in its history of operating in the UK. But it wasn't just Microsoft gnashing its teeth: prominent members of the UK government, the traditionally pro-business Conservative party, were vocal in their opposition to the CMA's decision, seeing it as running counter to the UK's ambitions of being a global tech leader.

Activision Blizzard president Bobby Kotick sent an email to the publisher's staff announcing the news, welcoming the rejigging but saying "nothing substantially changes with the addition of this divestiture". Which does rather seem like saying the quiet part out loud, and may well raise a few eyebrows at the CMA. "More to come," is how Kotick signs off, and clearly he expects this tweak to be enough.

"We will carefully and objectively assess the details of the restructured deal and its impact on competition, including in light of third-party comments," said the CMA's chief executive Sarah Cardell to the BBC. "Our goal has not changed—any future decision on this new deal will ensure that the growing cloud gaming market continues to benefit from open and effective competition driving innovation and choice."

"We believe that this [new offer] is positive for players, the progression of the cloud game streaming market, and for the growth of our industry," ends Brad Smith. "We remain as committed as ever to bringing the incredible benefits of the acquisition to players, developers, and the industry. Today’s development brings us one step closer to bringing the joy of gaming to players everywhere." We've all seen some euphemisms for big-money deals in our time, but that's a cracker.

Rich Stanton
Senior Editor

Rich is a games journalist with 15 years' experience, beginning his career on Edge magazine before working for a wide range of outlets, including Ars Technica, Eurogamer, GamesRadar+, Gamespot, the Guardian, IGN, the New Statesman, Polygon, and Vice. He was the editor of Kotaku UK, the UK arm of Kotaku, for three years before joining PC Gamer. He is the author of a Brief History of Video Games, a full history of the medium, which the Midwest Book Review described as "[a] must-read for serious minded game historians and curious video game connoisseurs alike."

Read more
Assassin's Creed meets PUBG
Ubisoft is reportedly talking to Tencent about creating a new business entity to manage Assassin's Creed and other big games
Orc man looking pensively at camera
Former EA exec says the ailing mega-publisher missed a chance to snag Blizzard and other heavy hitters before Activision: 'EA saw all those first and passed on all of them'
Bobby Kotick in 2008, after the Vivendi merger that made Activision into Activision Blizzard.
Bobby Kotick says he'd never have raised World of Warcraft's subscription by even a dollar because 'it's a prickly audience, you don't wanna do too much to agitate them'
knockout city, rumbleverse, and multiversus key art divided in thirds
UK government says it won't change the rules on publishers taking videogames offline after selling them: 'We have no plans to amend existing consumer law on digital obsolescence'
Avowed - Kai crosses his arms
'It's nice to have options': Blizzard thinks Avowed's new cross-buy feature is breaking down barriers
CEO of Activision Blizzard, Bobby Kotick, speaks onstage during "Managing Excellence: Getting Consistently Great Results" at the Vanity Fair New Establishment Summit at Yerba Buena Center for the Arts on October 19, 2016 in San Francisco, California.
Bobby Kotick reckons the Warcraft film was 'a terrible idea' for Blizzard, and in the end 'was one of the worst movies I've ever seen'
Latest in Gaming Industry
Monster Hunter Wilds' stockpile master studying a manifest
As layoffs and studio closures continue to deathroll the western AAA industry, analyst points out 5 of 8 major Japanese companies hit all-time share prices this year
A still from a video announcement of Game Informer's return, featuring the magazine's Halo 2 issue.
Game Informer is back from the dead: 'The whole team has returned'
Typing on internet search toolbar: What am I doing?
How a Microsoft exec managed to pitch Microsoft Word through the genius tactic of being able to actually use it in a 'type-off' demanded by clients: 'I was the only one who'd actually been a secretary'
Half-Life wallpaper - Gordon Freeman
Former Valve exec says the company struggled to sell Half-Life until coming up with the ultimate 'one simple trick' of marketing manoeuvres: slapping a 'Game of the Year' sticker on the box
Gabe Newell looks into the camera, behind him is a prop of a turret from Team Fortress 2.
Gabe Newell's cult of personality is intense, but a Valve exec who worked with him says his superpower is how he 'delighted in people on the team just being really good at what they did'
The Spy from Team Fortress 2 holds up a folder with an accusatory expression.
One of Valve's original executives shares a very simple secret to its success: 'You can't use up your credibility' by trying to make bad games work
Latest in News
A long bendy arm stealing money from people in a subway car
'You're a very long arm. You steal things. It's a comedy game,' explains developer of comedy game where you steal things with a very long arm
The heroes are attacked by monsters
Pillars of Eternity is getting turn-based combat to mark its 10th anniversary, and that means PC Gamer editors will soon be arguing about combat mechanics again
Image of Ronaldo from Fatal Fury: City of the Wolves trailer
It doesn't really make sense that soccer star Ronaldo is now a Fatal Fury character, but if you follow the money you can see how it happened
Junah beginning a battle in Metaphor: ReFantazio.
Today's RPG fans are 'very sensitive to feeling like they wasted time' when they die, says Metaphor: ReFantazio battle planner—but Atlus still made combat hard anyway
Image of Cersei Lanniser from Game of Thrones: Kingsroad Steam early access trailer
A new Game of Thrones RPG is coming to Steam today with a cast of 'familiar faces,' which is good because it's really the only way to tell it's a GoT game at all
The new Prime Asset featured in the upcoming update for the Outlast Trials.
The Outlast Trials puts its already paranoid players under surveillance for a time-limited story event