Ubisoft and Activision Blizzard’s deal for cloud gaming rights, explained

Microsoft’s giant Activision Blizzard deal is complete, and it means Ubisoft has now obtained cloud streaming rights for Call of Duty, all other current Activision Blizzard games, and any coming over the next 15 years. It was a key concession from Microsoft that helped get the deal over the line with UK regulators. But what does it all mean?

Ubisoft will now control where Call of Duty and other Activision Blizzard games show up on cloud gaming services, with the exception of EU countries and the various cloud gaming deals Microsoft signed previously. If you live in a country that’s part of the European Economic Area (EEA) — which includes EU countries and also Iceland, Liechtenstein, and Norway — then you’ll get a free license to stream via “any cloud game streaming services of their choice” all current and future Activision Blizzard PC and console games that you have purchased.

If you’re outside the EEA, then it’s up to Ubisoft which services get cloud streaming rights for Activision Blizzard games, including licensing these back to Microsoft to include in Xbox Cloud Gaming. In theory, Ubisoft could deny Microsoft a license for future Activision Blizzard games, but in reality, that’s extremely unlikely to happen. Microsoft will need to pay a wholesale arrangement fee to license Activision Blizzard games for its cloud services, though.

It’s also legally possible for Ubisoft to offer Activision Blizzard games exclusively on certain cloud providers but, again, very unlikely. I say unlikely because unlike secret deals in the games industry for exclusivity or to keep games off Xbox Game Pass, everyone knows Ubisoft is controlling the rights here, and the company would face a backlash if it attempted to deny or block games from certain cloud services. Cloud providers will also still be offered a free license to stream these games in EU markets, thanks to the European Commission remedy.

A number of companies wanted the cloud gaming rights for Activision Blizzard games and had to essentially pitch the Competition and Markets Authority in the UK. The interview-like process meant the CMA picked out the companies that would work best with its concerns over cloud gaming, and then it was up to Microsoft to ultimately decide on which company to restructure its deal with.

“We’ve been active in the streaming space for a long time and that’s one of the reasons Microsoft came to us; we were the first studio that Google worked with for Stadia; the first company that Amazon worked with for Luna; and we’ve been partners with NVIDIA GeForce Now for years,” explains Chris Early, Ubisoft’s SVP of strategic partnerships and business development. “To Microsoft, it made sense that if somebody was going to be familiar with the space and know what the value would be for streaming, it would be us. And we saw the value as well.”

The deal with Ubisoft means that Activision Blizzard games will now be available on Ubisoft Plus, the company’s game subscription service. Work begins on bringing these games to Ubisoft’s subscription today, but it’s not clear when they’ll all be available.

While the deal lasts for 15 years, the licenses are perpetual, so Ubisoft will still have the rights and still be able to provide games to people and companies worldwide (outside of the EEA) even after those 15 years pass by.

“Our expectation is that they will be on Ubisoft Plus, and then we have the rights to be able to license them individually to companies as well,” says Early. “Perhaps there’s a company somewhere in the world that wants to license those rights and add to the streaming service they have or start up a new streaming service, and I think that’s going be part of the fun of the next 15 years or more of how streaming evolves.”

Activision Blizzard games will also be available on a variety of cloud gaming services thanks to deals Microsoft struck to appease EU regulators. Those deals include:

• Nvidia: operator of GeForce Now cloud gaming service
• Boosteroid: largest independent cloud gaming provider based in Ukraine
• Nware: Spain-based cloud gaming provider
• Ubitus: Taiwan-based cloud gaming provider
• EE: British mobile network provider

Microsoft has also signed deals with Nintendo and Sony for Call of Duty and made a commitment to Valve to keep Call of Duty on its Steam store.