Microsoft has announced plans to sell the cloud gaming rights to Activision Blizzard titles to Ubisoft in an effort to get approval for its pending acquisition of the Call of Duty maker in the U.K.
Under this 15-year deal, Microsoft would still own and operate Activision Blizzard games, but Ubisoft would ultimately have worldwide control over where these titles can be streamed. This includes bringing these titles to the French publisher’s own Ubisoft+ streaming service. Ever since Microsoft announced its intention to acquire Activision Blizzard, it’s been upfront about its desire to put the company’s games on its Xbox Game Pass service.
However, there has been concern from regulatory bodies and rivals like PlayStation that this would be anti-competitive, with the CMA, in particular, blocking the deal and arguing that it would give Microsoft too much of a leg up in the nascent cloud gaming market.
Therefore, Microsoft’s new Ubisoft deal ensures that Activision Blizzard games can’t exclusively release on Game Pass’ streaming service, Xbox Cloud Gaming, until 2028. With this deal, Microsoft would have to pay for the rights to bring Activision Blizzard titles to Xbox Cloud Gaming.
While there had been speculation that Microsoft may divest the rights to address the U.K.’s Competition and Markets Authority (CMA) anti-competition concerns, Ubisoft is a surprise buyer. Through this Ubisoft deal, Microsoft says that it believes that its proposed acquisition of Activision Blizzard now “presents a substantially different transaction under UK law than the transaction Microsoft submitted for the CMA’s consideration in 2022.”
This agreement would also help Ubisoft, as the publisher has been struggling as of late. The company’s sales have slumped and it has cancelled several games, on top of a slow release pipeline in recent years. To address this, it’s currently working on a slew of Assassin’s Creed games, live services and Star Wars Outlaws.
Of course, everything here is contingent on the acquisition getting the CMA’s approval. Last month, Microsoft and Activision Blizzard agreed to extend the merger deadline until October 18th. It remains to be seen what the CMA will ultimately rule before that date.
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