Microsoft, Nware sign 10-year cloud gaming deal

Monday, May 1, 2023

Microsoft's headquarters in Redmond, Washington, US, in 2016.
Image: Coolcaesar.

Microsoft and Spanish cloud-gaming platform Nware signed a 10-year agreement on Friday to allow Nware to stream Microsoft gaming titles.

Microsoft Vice Chairman Brad Smith announced the deal on Twitter, saying "while it's still early for the emerging cloud segment in gaming, this new partnership combined with our other recent commitments will make more popular games available on more cloud game streaming services than they are today". Financial details were kept secret by the parties.

On Wednesday, UK regulator the Competition and Markets Authority (CMA) blocked Microsoft's acquisition of Activision Blizzard, citing fears it would stifle competition, saying Microsoft would have a reason to make titles exclusive to their own services. Friday's agreement would extend to titles held by Activision in the event the acquisition is successful.

Reuters described the Microsoft-Nware deal as an attempt to provide reassurance that the acquisition of Activision would not harm competition.

Microsoft has previously signed agreements with companies, including Nvidia and Boosteroid, to allow streaming both Activision and Microsoft titles on their services. Both companies spoke up against CMA's decision, with Nvidia tweeting "we see this [deal] as a benefit to cloud gaming and hope for a positive resolution".

Addressing these agreements, the CMA said "implementing the ineffective remedy would have replaced market forces with ongoing regulatory obligations overseen by the CMA, when competitive forces in a free market are much better placed to achieve the right outcome" and "such remedies are described as ‘behavioural’ because they seek to regulate the behaviour of the businesses… contrary to their commercial incentives." The CMA specified that Microsoft's proposals "did not sufficiently cover different cloud gaming service business models, including multigame subscription services" and are "not sufficiently open to providers who might wish to offer versions of games on PC operating systems other than Windows."

Microsoft announced their intentions to challenge the CMA's decision, with Activision saying they would "work aggressively with Microsoft to reverse this on appeal".

In the US, the Federal Trade Commission filed a suit to stop the purchase of Activision. According to Reuters, European regulators are expected to make a decision by May 22.

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Sources

Tiyashi Datta. "Microsoft signs 10-year deal with Spain's Nware after UK blocks Activision bid" — Reuters, April 28, 2023
Alkesh Sharma. "Microsoft signs 10-year deal with Spain's Nware after UK watchdog blocks Activision bid" — The National News, April 28, 2023
Michael Kan. "Nvidia Rebuts UK, Says Microsoft-Activision Deal Good for Cloud Gaming" — PCMag, April 28, 2023
Press Release: "Microsoft / Activision deal prevented to protect innovation and choice in cloud gaming" — Competition and Markets Authority, April 26, 2023

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