Microsoft announced today that it’s partnering with European cloud gaming platform Nware. The two companies just signed a 10-year deal where the console manufacturer and game publisher would stream PC games on Nware’s platform. This announcement comes only a few days after the news that UK regulators blocked Microsoft’s acquisition of Activision Blizzard — in part due to concerns about cloud gaming competition.
Brad Smith, president of Microsoft, announced the deal on Twitter. According to Smith, the company sees this as making more games available to users on more platforms: “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.”
This announcement comes very close on the heels of the news that the UK’s Competition and Markets Authority (CMA) blocked Microsoft’s $69 billion acquisition of Activision Blizzard. The CMA’s primary objection to the acquisition was the worry that it would stifle the cloud gaming market. Microsoft has since said it will appeal this decision.
In the summary of its conclusions, the CMA says Microsoft has, “a current [cloud gaming] market share of 60-70% … Microsoft proposed a remedy that sought to compensate for the loss of competition with a set of obligations that would regulate its behaviour and how it did business for a period of ten years. Having carefully considered Microsoft’s proposal, we found that it would not restore the competitive dynamism that would be lost as a result of the Merger.”
Microsoft has made other, similar deals with cloud gaming platforms such as GeForce Now and Boosteroid. Another objection from the CMA is that the 10-year deals allow Microsoft to retain revenue from all transactions related to Activision games, even on other platforms. According to the final report, “as a result, cloud game streaming services would not become rivals to Microsoft’s Game Pass Ultimate, but rather, they would become Microsoft’s customers.”