Microsoft Corp has struck a 10-year deal to bring “Call of Duty” and other Activision games to Nvidia Corp’s gaming platform if the Xbox maker is allowed to complete its $69 billion acquisition of Activision.
Editors and competitors like Sony have come out strongly against the Microsoft-Activision tie-up. The move may allay concerns by ensuring more ways for consumers to access Microsoft-owned games, but regulators around the world are skeptical of the acquisition.
The UK earlier this month said the deal could hurt gamers by weakening competition between the Xbox and PlayStation, leading to higher prices, less choice and reducing innovation for millions of players, as well as disrupting competition in today’s games.
Microsoft President Brad Smith said at a press conference on Tuesday that he is more optimistic about acquiring Activision after Nvidia’s deal with a similar arrangement with Nintendo Co Ltd.
Phil Eisler, vice president and general manager of Nvidia’s GeForce Now division, said titles like “Call of Duty” won’t be available on Nvidia’s service until Microsoft gets the Activision but other titles owned by Microsoft such as “Minecraft” are quickly covered. under a 10-year license agreement.
“We were worried about it in the beginning,” Eisler said of the Microsoft-Activision deal. “But we reached out to Microsoft, and they were very open about wanting to allow cloud gaming and work with us on a 10-year license agreement. So, over time, they it makes us more and more comfortable with it.”
Eisler said that Nvidia does not pay Microsoft for acquiring titles, which is the same arrangement the company has with other game companies such as “Fortnite” maker Epic Games. Instead, Nvidia’s 25 million customers need to pay Nvidia for access to its cloud gaming platform and pay Microsoft for its games.
Shares of Microsoft fell 2%, Nvidia fell 3.4% and Activision fell 0.7% in a broad market low on Tuesday afternoon.
Nvidia says it is currently supporting Xbox’s bid to buy Activision, but the deal could still be difficult to sell to management. European officials issued a warning to Microsoft about the deal earlier this month, but the US Federal Trade Commission asked a judge to block it. Britain’s competition watchdog says Microsoft may have to withdraw “Call of Duty.”
Smith said he hoped Sony Group Corp would consider doing the same kind of deal with Nvidia.
Sony has led the opposition to the Microsoft-Activision deal, saying last year it was “bad for competition, bad for the games industry and bad for gamers themselves.”
In addition to Sony and Nvidia, other companies including Alphabet Inc’s Google expressed concerns to the FTC about the transaction, according to media reports.
Microsoft has committed to keeping “Call of Duty” on Sony’s PlayStation. The popularity of the original shooter franchise has not waned nearly two decades after its launch, with the latest installment reaching $1 billion in sales. on the first 10 days of October.
The American technology company has said that the transaction is better than “Call of Duty.” It said that buying the company that also makes “Overwatch” and “Candy Crush” will increase its growth in mobile, PC, and cloud games, as well as consoles, to help it compete and the likes of Tencent as well as Sony.
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