The company hopes it will help it acquire Activision.
Image credit: Activision Blizzard | Call of Duty Modern Warfare 3
The Microsoft/Activision $68.7 billion deal has quietened down since the FTC hearing, but it doesn't mean the battle is done. Now, Microsoft needs to make the UK regulator change its mind, and it has come up with a plan.
Microsoft is going to sell cloud streaming rights for current and new Activision Blizzard games to Ubisoft.
“To address the concerns about the impact of the proposed acquisition on cloud game streaming raised by the UK Competition and Markets Authority, we are restructuring the transaction to acquire a narrower set of rights,” said Microsoft president Brad Smith. “This includes executing an agreement effective at the closing of our merger that transfers the cloud streaming rights for all current and new Activision Blizzard PC and console games released over the next 15 years to Ubisoft Entertainment SA, a leading global game publisher. The rights will be in perpetuity.”
Cloud gaming is one of the CMA's concerns, and this decision could potentially finally secure the deal that started last year. This means Microsoft won't be able to release Activision's games on its Xbox Cloud Gaming service exclusively and control the licensing terms of the studio's games for rival services.
Ubisoft will "innovate and encourage different business models in the licensing and pricing of these games on cloud streaming services worldwide."
"Ubisoft will compensate Microsoft for the cloud streaming rights to Activision Blizzard’s games through a one-off payment and through a market-based wholesale pricing mechanism, including an option that supports pricing based on usage. It will also give Ubisoft the opportunity to offer Activision Blizzard’s games to cloud gaming services running non-Windows operating systems."
So Activision's games will also appear on Ubisoft+ Multi Access across multiple platforms including PC, Xbox, PlayStation, and Amazon Luna.
The CMA prohibited the original deal worldwide while it is investigating the new contract. "This is not a green light," it says. The organization will assess the details of the deal and its impact on the competition before its next verdict.
"Ubisoft will also be able, for a fee, to require Microsoft to adapt Activision’s titles to operating systems other than Windows, such as Linux, if it decides to use or license out the cloud streaming rights to Activision’s titles to a cloud gaming service that runs a non-Windows operating system."
Under the agreement with Ubisoft, Microsoft will still acquire the rights needed to fulfill its legal obligations to the European Commission and cloud game streaming providers, including NVIDIA, Boosteroid, Ubitus, and Nware.
The CMA's decision will be revealed before October 18. Stay tuned, find Microsoft's announcement here, and join our 80 Level Talent platform and our Telegram channel, follow us on Threads, Instagram, Twitter, and LinkedIn, where we share breakdowns, the latest news, awesome artworks, and more.