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British antitrust officials said on Tuesday they are reviewing a revised bid from Microsoft to win approval for its $69 billion merger with Activision Blizzard, in a bid to remove the biggest remaining regulatory hurdle for a major video game deal.
To address British regulators’ concerns that the deal would impede the development of a new area of gaming technology, Microsoft He said It will transfer the cloud licensing rights to all existing and new Activision Blizzard games to Ubisoft Entertainment, a competing game publisher.
Why it matters: The show aims to address concerns about cloud gaming.
The deal, which had long been facing odds, now appears to be on its way to approval. Britain is the last major objector standing in the way of completing the massive takeover.
Microsoft’s revised bid is a bid to win over the country’s main antitrust regulator, the Competition and Markets Authority, which said in April it would block the merger over concerns about its impact on so-called cloud gaming, an emerging area of technology. It allows people to stream games to phones, tablets, and other devices, potentially eliminating the need for consoles.
Under the new terms, Microsoft will give Ubisoft control of licensing deals for cloud gaming services for 15 years. This is intended to prevent Microsoft from releasing titles exclusively on its cloud streaming service, Xbox Cloud Gaming.
Sarah Cardell, CEO of the Competition and Markets Authority, Display is called “It is very different from what was put forward previously,” but he cautioned, “This is not a green light.”
“Our goal has not changed,” she said in a statement. “Any future decision on this new transaction will ensure that the growing cloud gaming market continues to benefit from open and efficient competition that drives innovation and choice.”
Background: Microsoft overcame other objections to the deal.
After announcing its intention to buy Activision in January 2022, Microsoft faced a host of scrutiny, as the deal became a litmus test for whether regulators around the world would approve the tech giant amid concerns about the strength of the industry. Competitors such as Sony have lobbied to have it banned.
The takeover faced an upside after the US Federal Trade Commission sued to block it in December and British authorities said they would similarly try to stop the takeover.
But Microsoft scored a major victory in May when the European Union approved the deal. And in July, a US federal judge ruled against the FTC’s efforts to slow the deal, leaving only British authorities as the main hurdle to clear.
What’s next: A decision is expected by October.
The UK regulator said it would issue a decision by October 18, the date Microsoft has set as the deadline for completing its deal with Activision.