Enlarge / Ubisoft could be the new home to Activision's streaming catalog under a new proposal from Microsoft. (credit: Ubisoft)

In a major restructuring of its long-proposed acquisition plans for Activision Blizzard , Microsoft has announced that the cloud-streaming rights for current and future Activision titles will be controlled by Ubisoft rather than Microsoft itself. The move is an effort to ameliorate concerns from UK regulators who blocked the proposed acquisition in April over potential impacts on competition in the cloud-gaming space.

The newly proposed deal covers perpetual, worldwide streaming rights for all current Activision games and those released in the next 15 years, according to an announcement from Microsoft Vice Chair President Brad Smith. Ubisoft will have exclusive control of those streaming rights outside of the European Union, allowing the company to make those games available on its own Ubisoft+ service and to license them out to other cloud-gaming providers (including Microsoft itself). In the EU, Microsoft will pay to license those Activision streaming rights back from Ubisoft to satisfy promises made to the European Commission regarding free licensing to competing cloud-gaming providers.

In a statement provided to Ars Technica, Ubisoft said the deal would allow Activision titles to be offered via Ubisoft+ Multi Access on PC, Xbox, and Amazon Luna, as well as via Ubisoft+ Classics on PlayStation . "Today’s deal will give players even more opportunities to access and enjoy some of the biggest brands in gaming," said Chris Early, Ubisoft SVP of Strategic Partnerships and Business Development, in the statement.

Enlarge / Attorneys carrying boxes arrive to court in San Francisco, California, US, on Tuesday, June 27, 2023. A judge has ruled that the FTC's reliance on the PlayStation chief's testimony was unpersuasive, while Microsoft and Activision's efforts will help avoid market concentration. (credit: Getty Images)

A federal judge in San Francisco today denied the Federal Trade Commission's motion to halt Microsoft's acquisition of Activision Blizzard, ruling that the FTC was unlikely to prove that the merger would "substantially lessen competition."

Judge Jacqueline Scott Corley's decision (PDF) is heavily redacted in sections covering the company's assets and performance in "AAA Content," "Exclusive Content," and "Cloud Gaming Subscription Services," among others. Segments of those redactions were likely seen in earlier filings, which were poorly redacted with a marker and revealed key financial figures.

The FTC's motion for a temporary restraining order and injunction was filed in an attempt to disrupt the deal before its purported July 18 deadline . The FTC had already initiated an administrative action to investigate the deal's effect on gaming markets, but it petitioned the US District Court for Northern California that Microsoft and Activision "may consummate the Proposed Acquisition at any time."

Enlarge / The Spartan-themed "NickMercs" skin that was recently removed from Call of Duty . (credit: Activision)

Call of Duty has removed a skin based on popular Warzone streamer and FaZe Clan co-owner Nicholas "NickMercs" Kolcheff after controversy over a tweet surrounding an LGBTQ protest.

"Due to recent events, we have removed the 'NickMercs Operator' bundle from the Modern Warfare II and Warzone store," publisher Activision wrote in a tweet after Call of Duty news site Charlie Intel noticed the unannounced removal . "We are focused on celebrating PRIDE with our employees and our community."

Enlarge / A small selection of the characters that would be part of Microsoft if its proposed Activision/Blizzard merger is allowed to go through. (credit: Activision Blizzard King)

Activision isn't pulling any punches in its fight against the UK's regulatory attempts to block its merger with Microsoft . In a "motion to intervene" recently filed with the Competition Appeal Tribunal (and recently summarized on the tribunal's website ), Activision excoriates the UK's Competition and Markets Authority for a "flawed conclusion" that was variously "unlawful, irrational, and/or disproportionate" and "arrived at in a procedurally unfair manner."

The appeal takes particular issue with the CMA's focus on cloud gaming in a vacuum, without taking into account competition from "native gaming" via games running on local hardware. The ability to easily switch from one type of game experience to the other means that cloud gaming should not be a "separate product market," Activision argues.

A source close to Activision's appeals process (who asked for anonymity to speak frankly about the appeal) put a finer point on this argument, saying that cloud gaming is a niche technology and that "most consumers continue to get games by download or physical disc because running the game on their local hardware gives them a much better experience."

Activision has sent cease-and-desist letters to two makers of popular fan clients for legacy Call of Duty titles in recent weeks. The move cuts off access to the many gameplay and quality-of-life improvements brought by these clients and stops what fans say is the only safe way to play these older games without the threat of damaging hacking by opponents.

The first victim of Activision's recent efforts was SM2, a major Modern Warfare 2 modding project whose development started over two years ago . Since then, the modding group has been working on updating that seminal 2009 release with new weapons, in-game perks, a redesigned UI, new streak and progression systems, and even a recent move to a more modern game engine .

Those efforts stopped last week, though, before the mod could even release its first version. The SM2 Twitter account reported that "a team member received a Cease & Desist letter on behalf of Activision Publishing in relation to the SM2 project. We are complying with this order and shutting down all operations permanently."

Enlarge / A group of PlayStation owners worries that an image like this is coming in their near future...

A federal judge has refused to grant a requested preliminary injunction that would have stopped Microsoft's continuing effort to buy Activision Blizzard . But as the private case moves forward, the judge in the case writes that the plaintiffs have "plausibly" argued that they might be adversely affected by the deal's anti-competitive effects.

The so-called "gamers' lawsuit" against the Microsoft/Activision deal was initially filed by a group of 10 PlayStation Call of Duty players in December, alleging that the deal could lead to increased prices and/or decreased quality or availability for the franchise on their console of choice. While the case was dismissed in March , the plaintiffs offered an amended complaint last month , laying out more precisely the harm they believe they could suffer after a merger.

Regarding those amended claims, District Court Judge Jacqueline Scott Corley said in a Friday ruling that, while it was too early to fully rule on the merits of the case, the plaintiffs "plausibly attest to their loyalty to the Call of Duty franchise and thus that each will purchase a different console or subscription service, or pay an inflated price, if needed to continue to play Call of Duty, especially if needed to play with their friends." That's a turnaround from the initial March dismissal, where Corley wrote that the plaintiffs didn't "plausibly allege" that the merger "creates a reasonable probability of anticompetitive effects in any relevant market."

Enlarge (credit: INA FASSBENDER / Contributor | AFP )

Last December, Call of Duty gamers sued Microsoft , seeking to block its merger with Activision, partly because they alleged that the merger would set up Microsoft to dominate industry rivals, drive up prices, and reduce consumer choice. Yesterday, a California judge, Jacqueline Corley, granted Microsoft’s motion to dismiss the suit, saying that the gamers didn’t “plausibly allege” that the merger “creates a reasonable probability of anticompetitive effects in any relevant market.”

Gamers suing don’t plan to give up this fight that easily, though. They have 20 days to amend their complaint to include more evidence that demonstrates those anticompetitive effects are likely to harm them personally.

The gamers' lawyer, Joseph Alioto, told Ars that he believes they have ample evidence to satisfy the judge in this case. He confirmed that gamers intend to file their amended complaint as soon as possible. Rather than being discouraged by the judge’s dismissal, Alioto told Ars that the gamers were pleased by Corley’s order.

Since 2003, publisher Activision has teamed up with various developers to release Call of Duty games on various platforms. Its longest standing partner is California-based Infinity Ward, whose team was responsible for the 2019 release Call of Duty: Modern Warfare.

Available for Windows, PS4 and Xbox One, Modern Warfare received plenty of praise but not everyone is happy with the end result.

According to a lawsuit filed in a Texas court yesterday, Activision, Infinity Ward (IW), and Major League Gaming Corp (MLG) committed copyright infringement after copying and then passing off a character design as their own.

“Deliberate, Intentional and Comprehensive Copying”

Plaintiff Clayton Haugen describes himself as a writer, photographer and videographer from North Carolina. He is also the copyright owner of two literary works and 22 photographs of a character he named ‘Cade Janus’, the central figure in his story ‘November Renaissance’, which he hoped could be made into a film.

In 2017, Haugen says he hired ‘talent’ (actress, cosplayer, twitch streamer Alex Zedra) to portray ‘Cade Janus’ and took a series of photographs, which together with his story were presented to film studios. In a further promotional effort, the photographs were also published on Instagram and in a series of calendars. It appears that the defendants also became of Haugen’s work.

As part of their hunt for a “strong, skilled female fighter”, the defendant videogame companies (through contractors) allegedly hired the same ‘talent’ (Zedra) and asked her to obtain the same clothing and gear used in the original ‘Cade Janus’ photoshoot from Haugen himself.

The companies also hired the same makeup artist, who was instructed to copy the makeup and hair as depicted in the original photographs, “even using the same hair extension piece.” Haugen further alleges that his original photographs were posted to “the wall of the studio” and used as a framing guide before the model was 3D-scanned.

“To conceal their planned infringement of Haugen’s Cade Janus Photographs and his Cade Janus character, Defendants required the talent and the makeup professional to sign Non-Disclosure Agreements,” the complaint notes.

“The resulting photographs were intended to be, and were, copies of Haugen’s Cade Janus Photographs,” the lawsuit reads.

Infringing Photographs Used to Market Modern Warfare

According to Haugen, the resulting photographs and three-dimensional images were not only used to develop the in-game character ‘Mara’ but also deployed as key assets in Modern Warfare’s marketing campaign.

“With this infringing female character as the centerpiece of an advertising campaign for the first time in the Call of Duty series, [defendants] shattered all previous sales and games-played records. Call of Duty: Modern Warfare has generated more than a billion dollars in revenues,” the lawsuit reads.

Copyright Infringement Claims

As the copyright owner of the works in question, Haugen explains that he has the exclusive right to make copies and derivatives, and the exclusive right of distribution. The lawsuit reveals that while Haugen had copyrights registered for his story back in 2012 and 2013, the Copyright Office only registered his photographs on December 21, 2020, presumably so he could file this complaint.

Haugen says that the character ‘Mara’ is “substantially similar” to his creation ‘Cade Janus’ and provides samples to show that his original photographs were copied during a Modern Warfare photoshoot in 2019.

As a result, Haugen claims that Activision, Infinity Ward and Major League Gaming have infringed and continue to infringe his rights. In the alternative, Activision Blizzard has or has had a financial interest in the infringement of Haugen’s copyrights so can be held vicariously liable for the infringements of the trio.

In a further alternative, the defendants knew that the other defendants and their contractors were infringing and induced and/or encouraged that behavior, making them liable for contributory infringement of Haugen’s rights.

“Haugen is entitled to recover all monetary remedies from Defendants’ infringement, including all of their profits attributable to their infringements, to the full extent permitted by 17 U.S.C. § 504 ,” the complaint concludes, demanding a trial by jury.

The complaint can be found here (pdf)

From: TF , for the latest news on copyright battles, piracy and more.

Enlarge (credit: Blizzard Entertainment)

The corporate-behemoth organism that is Blizzard Entertainment, which exists in a symbiotic state next to megaton game publisher Activision, became blurrier on Friday with a surprise announcement: It has absorbed a game studio within the Activision family, effective immediately.

Vicarious Visions, a longtime game studio that was acquired by Activision in 2005, has been shuffled out of the Activision ecosystem and pumped directly into Blizzard's veins. In a statement offered to GamesIndustry.biz , Blizzard confirmed that the 200+ staff at Vicarious Vision has been shifted to a "long-term support" team focused entirely on "existing Blizzard games and initiatives." The news also includes a mild shuffle of leadership, sending current Vicarious studio head Jen Oneal to the Blizzard leadership board as executive vice president of development.

The statement did not clarify exactly when this arrangement began, nor which of Blizzard's "existing" projects would receive Vicarious staff support in particular. (Blizzard representatives did not immediately respond to Ars Technica's questions about the deal.) As of press time, neither Blizzard nor Vicarious have published details or terms about the deal on their respective blogs or social media channels. In fact, Vicarious Visions' website is currently offline altogether.

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