The UK Competition and Markets Authority blocked Microsoft's $69 billion deal to buy Activision Blizzard in late April. At the time, the CMA stated that it felt Microsoft could dominate the currently small cloud gaming market with exclusive access to Activision Blizzard's games. Now a new report claims Microsoft may be willing to sell off at least some of its cloud gaming rights in the UK to get the CMA's approval.
Bloomberg's story, citing unnamed sources, claims Microsoft is considering selling its cloud gaming rights in the UK to a third-party company. It could be offered to a telecommunications company, a gaming publisher, an internet-based business, or even a private equity company, according to the article.
Microsoft has already made a 10-year deal with UK-based telecommunications company EE to offer its Xbox and Activision Blizzard games on EE's cloud gaming service if the acquisition is completed. It would seem like a deal with EE to give them full UK game streaming rights for Xbox and Activision Blizzard games would be a natural next step.
The clock to make any sort of deal with the CMA is winding down very quickly. Microsoft and Activision Blizzard have until July 18 to close this deal according to their original plans. After that, it's possible the two companies could enter talks to extend the deal deadline, or Microsoft could walk away and give $3 billion to Activision Blizzard as a consolation prize.
Right now, all eyes are on the US Ninth Circuit Court of Appeals. It's expected to make a ruling sometime before the end of the day today on the US Federal Trade Commission's request for a preliminary injunction to keep Microsoft from buying Activision Blizzard. If the court does deny the FTC's request, it's possible Microsoft could finally close the deal over the weekend or on Monday.
Update: The CMA has announced an extension of its investigation of this deal from July 18 to August 29. However, it added that it "aims to discharge its duty as soon as possible and in advance of this date." This may mean that talks between Microsoft and the CMA are not expected to be completed before Microsoft's own deal deadline on July 18.