Microsoft Corp. MSFT has responded directly to the Federal Trade Commission’s (FTC) claims regarding layoffs following the acquisition of Activision.
The Battle Between Microsoft and the FTC.
However, Microsoft countered, stating that Activision had already planned significant job cuts before the merger, and lambasted the FTC’s assertions as “incomplete and misleading,” The Verge reported.
Microsoft clarified: “Activision was already planning on eliminating a significant number of jobs while still operating as an independent company.”
Insight into Gaming Industry Trends
The filing also noted that Activision’s pre-existing layoff plans aligned with industry trends impacting the gaming sector. This aligns with layoffs announced by other gaming companies like Sega Sammy Holdings Inc SGAMY and CI Games, reflecting wider industry challenges.
Microsoft had previously stated that the layoffs were due to identifying overlaps and the need for a sustainable cost structure. This was reiterated in Microsoft Gaming CEO Phil Spencer‘s memo accompanying the initial announcement of the company’s 1,900 layoffs within its gaming department last month.
Furthermore, the tech giant asserted in the court filing its readiness to reverse the acquisition. Game Rant reported, a company representative clarified that the deal allows for divestment from Activision if necessary, although such a scenario is deemed unlikely.
The FTC’s objections primarily concern antitrust matters rather than workforce protections, making it questionable whether recent layoffs across Activision subsidiaries would affect court approval of the acquisition.
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