Microsoft Re-Negotiates Acquisition of Call of Duty
TECH DIGEST- Microsoft Submits Revised Bid for Activision Blizzard Acquisition After Initial Offer Rejected by UK Competition Watchdog. Microsoft has presented a modified proposal to acquire Activision Blizzard, following the UK competition watchdog’s rejection of their original $69 billion bid.
The Competition and Markets Authority (CMA) confirmed on Tuesday that Microsoft’s initial offer for the renowned gaming company had been denied. Although the CMA will review the updated deal, it clarified that this does not indicate approval.
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In the new offer, Microsoft will not secure the rights to Activision’s current or future cloud-based games. This commitment, spanning 15 years, will exclude Activision’s PC and console games in the European Economic Area. Cloud-stored games, akin to content streaming services like Netflix, enable players to purchase content at their convenience.
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Contrary to controlling all of Activision’s game portfolio, including titles like Candy Crush, Microsoft announced that the content will be sold to rival video game publisher Ubisoft. Ubisoft will then be able to distribute Activision’s content to various cloud gaming service providers, including Microsoft itself.
Microsoft’s potential acquisition of Activision Blizzard could mark the largest deal ever in the gaming industry. The company, known for its Xbox gaming console, aims to enrich its Game Pass streaming service with a broader selection of titles. This service allows gamers to download content on consoles and mobile devices. However, the deal has raised concerns among regulators in the UK, Europe, and the US.
Competitors such as Sony have voiced objections to the acquisition, fearing that Microsoft might limit the availability of significant games to its own PlayStation platform. Notably, the latest Call of Duty installment, Modern Warfare 2, generated $1 billion in its opening weekend, with over half of UK sales being for the PlayStation.
Sarah Cardell, CEO of the CMA, noted that Microsoft’s revised deal significantly differs from its earlier proposal. She confirmed that the CMA would meticulously assess the new offer’s details and its implications for competition. She reaffirmed the CMA’s commitment to preserving an open and competitive cloud gaming market that encourages innovation and consumer choice.
