Photo: Jaap Arriens (Getty) The Federal Trade Commission (FTC), raising concerns over Microsoft’s $68.7 billion acquisition of Activision Blizzard, informed a court on Wednesday that Microsoft’s recent staff reduction goes against its assurance to obtain approval for the merger. Caution! Microsoft Aims to Empower ChatGPT for Robotic ControlIn a communication to the clerk of the Ninth Circuit Court of Appeals, the FTC admonished Microsoft for laying off 1,900 employees in January, which accounts for about 8% of its gaming unit. The downsizing significantly impacted workers at Activision Blizzard. The antitrust watchdog argued that the move “inconsistently contradicts Microsoft’s representations in this Court that the two entities would operate independently post-merger.” Microsoft Gaming director Phil Spencer had stated in a memo announcing the layoffs in January 2024, “As we progress into 2024, the leadership of Microsoft Gaming and Activision Blizzard are dedicated to finding a strategic and sustainable plan that will bring lasting value to support our expanding business.” “We have jointly established priorities, identified areas of overlap, and ensured coordinated efforts on the most promising growth opportunities.” The FTC’s letter comes on the heels of a plea by Sen. Elizabeth Warren, D-Massachusetts, to the FTC to stand firm against the deal. “Just three months after @Microsoft’s merger with @Activision, 1,900 workers have been laid off. I cautioned that this arrangement would be detrimental to employees,” Warren mentioned in a January 25th tweet. “The @FTC must persist in its efforts to halt this deal.” Microsoft finalized the acquisition of Activision Blizzard last October after a nearly two-year tussle with regulators. Notwithstanding, the FTC has not given up its opposition to the union. In December, it appealed to the Ninth Circuit Court of Appeals to invalidate the deal, a move deemed contentious by legal scholars. Activision Blizzard’s workforce may pose a challenge if the control is overturned.
