Microsoft to concede Call of Duty to Sony for 10 years to stave off UK government’s halt of ActiBlizz buyout

Popcorn appropriately.

Over the past couple of months, the UK’s Competition and Markets Authority (CMA) has been putting Microsoft’s buyout of Activision-Blizzard under a microscope, with one of the sticky wickets being the Call of Duty series and Sony’s access to the IP. The CMA has argued that Microsoft has “incentive to foreclose Sony” from the franchise and that prior behavior leads the government body to believe that Microsoft wouldn’t be deterred from “engaging in total or partial foreclosure strategies by the prospect of reputational damage to Xbox or [Call of Duty]” even if it meant short-term losses.

It appears that Microsoft is now willing to wheel and deal over the matter, as insider reporting from Reuters says the company is set to offer a 10 year-long licensing deal to Sony for the franchise. This new concession is reportedly being filed before the CMA can issue a statement of objection to the deal in January, and it could ultimately shorten the regulatory process.

According to a law expert quoted by Reuters, this license agreement “could secure an early clearance with the European Commission and subsequently be used by the parties before other antitrust agencies,” though whether this answers the worries of wider competition squashing remains to be seen. Readers will recall that competition is being noted as one of the bigger reasons for halting the deal by both the CMA and the US’s Federal Trade Commission, which stated its possible intention to file an antitrust lawsuit to halt the deal last week.

Activision-Blizzard is considered a controversial gaming company owing to a long string of scandals over the last few years, including the Blitzchung boycott, mass layoffs, labor disputes, and executive pay fiasco. In 2021, the company was sued by California for fostering a work environment rife with sexual harassment and discrimination, the disastrous corporate response to which compounded Blizzard’s ongoing pipeline issues and the widespread perception that its online games are in decline. Multiple state and federal agencies are investigating the company as employees unionize and call for Bobby Kotick’s resignation. As of 2022, the company is being acquired by no less than Microsoft.
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