Online Xbox Series X Games – Microsoft to Pay $3 Billion “Breakup Fee” to Activision Blizzard

The block from UK regulators against the ongoing merger between Microsoft and Activision Blizzard raises concerns about cloud gaming’s future. Losing this deal would cost Microsoft dearly, as Activision Blizzard CEO Bobby Kotick confirmed. So, his company would receive a $3 billion “breakup” fee should the deal not go ahead. That would mean buying their online Xbox Series X games directly, and that might not be that bad.

Online Xbox Series X Games – Confirmation from Kotick

In an interview with CNBC, Kotick gave confirmation that the $3 billion fee is accurate. So, he does not counter the figure either. It’s clear that Activision Blizzard will come out of this arrangement a fair bit richer either way.

However, it’s the exact opposite for Microsoft, as it would still have to foot this smaller bill. Additionally, they will miss out on Activision Blizzard at the same time.

Great News for Shareholders?

If the deal doesn’t go through, Activision Blizzard will remain independent and collect the $3 billion breakup fee. According to Kotick, the company has spent 30 years putting out capital for its shareholders.

They do it quite well and will continue to do so. This is good news for shareholders but not so much for employees who may not get the same assurances.

Of course, $3 billion would be a huge downgrade as well. This is when you compare it to the almost $69 billion that Microsoft would pay to buy the company.

Kotick’s Controversial History

One of the worst things for workers is that if the deal doesn’t get through, Kotick remains CEO. Despite the abuse allegations within his company, he will only step down as CEO if the company merges with Microsoft. More than 1,500 employees called for his resignation in 2021, and yet he’s still clinging to power.

No Management Updates from Microsoft Yet

It remains uncertain what will happen to Kotick if the deal goes through. There have been contradictory reports on the matter, so it’s not clear if Microsoft intends to get rid of Kotick.

If so, then they would replace him with someone less infamous among developers and fans alike. However, he did win his election to the board of directors last year. So, his fellow executives don’t seem to have given up on him just yet.

Online Xbox Series X Games – Awaiting Decision from the UK

In the meantime, regulators in the US and EU are still reviewing the merger proposal. The UK was the first to announce its decision, but the US Federal Trade Commission has also challenged the takeover.

Additionally, the EU regulators did delay their decision in March after Microsoft’s request for concessions to get the deal over the line. It remains to be seen what the outcome will be for their online Xbox Series X games like CoD: MWII.

However, one thing is clear: losing the deal would have significant consequences for both Microsoft and Activision Blizzard.