US Senators Push FTC to Dig Deeper Into Microsoft’s Activision Blizzard Deal

Alessio Palumbo
Microsoft Activision-Blizzard

Four US senators have joined in sending a letter to the Federal Trade Commission (FTC), urging the government agency to dig deeper into Microsoft's massive (around $70 billion) Activision Blizzard deal announced earlier this year.

According to the Wall Street Journal, the letter was signed by senators Elizabeth Warren (Massachusetts), Bernie Sanders (Vermont), Cory Booker (New Jersey), and Sheldon Whitehouse (Rhode Island). Notably, all of them are Democrats, with the potential exception of Sanders, technically an independent but also previously a major candidate for the Democratic presidential nomination in 2016 and 2020.

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The WSJ report includes some choice quotes from the letter, with the senators showing concern for the industry consolidation, the impact on workers, and the lack of accountability for Activision Blizzard CEO Bobby Kotick (who might get to walk away relatively unscathed despite the many scandals related to the company's workplace culture).

We are deeply concerned about consolidation in the tech industry and its impact on workers.

This lack of accountability, despite shareholders, employees, and the public calling for Kotick to be held responsible for the culture he created, would be an unacceptable result of the proposed Microsoft acquisition.

As previously covered, Kotick would also get a massive paycheck of nearly $300 million due to termination because of leadership change.

That said, an Activision Blizzard spokeswoman pointed out that the deal with Microsoft would benefit everyone involved.

This is a compelling transaction for all stakeholders, including employees.

She also noted that no additional compensation arrangements for Mr. Kotick were made for the deal. Indeed, the clause mentioned above was included long before as part of his contract.

While the FTC may not be able to do anything about that, they can and undoubtedly are thoroughly reviewing the Activision Blizzard deal. Just ten days ago, we learned that the Federal Trade Commission had requested additional information and documentary material from both companies.

The news that the FTC would review the transaction instead of the Department of Justice (DOJ) already raised some flags on the likelihood of the closure, as the FTC has been viewed as harsher even since Lina Khan was appointed as the new Chair. The latest Kotaku report of alleged mismanagement and sexism at Undead Labs, a studio purchased by Microsoft around four years ago, could certainly increase the scrutiny of the Activision Blizzard deal.

For its part, Microsoft corporate VP and general counsel Lisa Tanzi stated:

We believe Activision Blizzard will continue making progress, and we’re committed to further progress after the deal closes.

As a reminder, Microsoft would have to pay Activision Blizzard between $2 and 3 billion if the deal falls through.

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