Microsoft Completes Acquisition of Activision Blizzard

Microsoft announced that it had completed its $68.7 billion acquisition of Activision Blizzard, one of the largest video game publishers in the world. The deal, which had been proposed in January 2022, faced scrutiny from various regulatory authorities, particularly the UK's Competition and Markets Authority (CMA).

In July 2022, the CMA launched a six-month investigation into the merger. In April 2023, it concluded that it would block the deal, citing concerns over the emerging cloud gaming industry. The CMA argued that Microsoft could utilize Activision Blizzard's game library to dominate the cloud gaming market, making it difficult for other cloud gaming services to compete.

In August 2023, Microsoft submitted a revised proposal to appease the regulator. The most significant point was to agree to sell the cloud gaming rights of Activision Blizzard games outside Europe to Ubisoft, a French video game company. The deal encompassed all Activision Blizzard games that would be released in the next 15 years.

The CMA stated that Ubisoft would be able to offer Activision's content under any business model, including through multi-game subscription services. Additionally, it would facilitate cloud service providers in using non-Windows operating systems (such as consoles) to play Activision games, thereby reducing costs and increasing efficiency.

After Microsoft and Ubisoft signed the agreement, the CMA softened its stance and announced in September 2023 that the revised deal was sufficient for provisional approval of the transaction.

On October 13, 2023, the CMA updated its statement on the UK government website, confirming its approval. The CMA agreed to Microsoft's acquisition of Activision Blizzard, but with the exclusion of Activision Blizzard's cloud streaming rights outside the European Economic Area (EEA, including EU countries as well as Iceland, Liechtenstein, and Norway). These rights would be sold before the completion of the merger.

The CMA viewed Microsoft's concession as a victory of its own. CMA Chief Executive Sarah Cardell stated that by selling Activision Blizzard's cloud streaming rights to Ubisoft, they ensured that Microsoft could not monopolize this important and rapidly growing market. She added that this intervention would lead to more competitive prices, better services, and more choices for consumers. Cardell proudly claimed that their competition authority was the only one in the world to achieve such an outcome.

Microsoft's Vice President and President, Brad Smith, who had previously criticized the CMA on social media, expressed his satisfaction with the CMA's decision. He welcomed the CMA's decision and stated on X (formerly Twitter) that the company had overcome the final regulatory hurdle to complete the acquisition, which they believed would benefit gamers and the gaming industry worldwide.

Activision Blizzard CEO Bobby Kotick also expressed his happiness and sent an email to all employees, stating that they had obtained all the necessary regulatory approvals for the acquisition and looked forward to bringing joy and connection to more players around the world.

As Smith and Kotick mentioned, the acquisition of Activision Blizzard had overcome its last major obstacle and had become a done deal.

A few hours later, the done deal became a fait accompli as Microsoft announced that it had completed the transaction, thereby making Activision Blizzard a wholly owned subsidiary. Phil Spencer, Microsoft's Chief Executive of Gaming, posted a statement on Xbox's official website, officially welcoming Activision Blizzard to Microsoft's family.

Spencer stated that on that day, they began bringing beloved Activision, Blizzard, and King franchises into Game Pass and other platforms. He promised to share more information about when players could expect to play these games in the coming months. He acknowledged the excitement of the players and expressed the company's own excitement.

He further added that for millions of fans who loved Activision, Blizzard, and King games, they wanted them to know that it was a good day to play games. He recognized them as the core and soul of these game IPs and expressed their honor to have them as part of their community. He assured them that they were welcome, regardless of whether they played games on Xbox, PS, Nintendo, PC, or mobile devices. He stated that when everyone played games, they all won.