Saying Microsoft’s (Nasdaq: MSFT)$68.7 billion acquisition of Activision Blizzard (Nasdaq: ATVI) is facing hurdles would be an understatement. At least two active lawsuits are trying to prevent the merger from happening, citing competition concerns.
First stop: the Federal Trade Commission (FTC) on Thursday filed an antitrust case against Microsoft, claiming the deal is an “illegal acquisition.” The commissioners, in a 3-1 vote, decided to pursue the agency’s administrative case after reports that the agency was investigating the deal. The case will be heard by the FTC’s own administrative law judge.
“With control of Activision’s content, Microsoft would have the ability and increased incentive to withhold or degrade Activision’s content in ways that substantially lessen competition,” the FTC complaint read.
The tech giant immediately responded to the complaint, reiterating the pledge it made that it won’t make Activision’s games exclusive to Microsoft’s Xbox, unlike some of its current titles under its belt.
“[Microsoft’s] vision for the transaction is simple: Xbox wants to grow its presence in mobile gaming, and three quarters of Activision’s gamers and more than a third of its revenues come from mobile offerings,” the company said in its filed response. “Xbox also believes it is good business to make Activision’s limited portfolio of popular games more accessible to consumers, by putting them on more platforms and making them more affordable.”
Activision publishes both console and mobile games with Call of Duty, World of Warcraft, and Candy Crush being some of its most popular titles.
The FTC asserted in its complaint that Microsoft is “one of only two manufacturers of high-performance video game consoles” with Xbox. The gaming unit has its own “first-party” titles and video game subscription service Xbox Game Pass, both of which contributed to cultivating an exclusive gaming environment within its assets.
“Microsoft has acquired over ten third-party studios and their titles in recent years to expand its offerings. Microsoft has frequently made those acquired titles exclusive to its own consoles and/or subscription services, eliminating the opportunity for consumers to play those titles on rival products or services,” the commission explained.
On the other hand, Activision is said to be a creator and publisher of high-quality video games for video game consoles, personal computers, and mobile devices, with most of its titles referred to as “AAA” in the industry. Because of the creative talent, money, and time necessary for development, AAA games are expensive to make.
“Activision and industry participants recognize Call of Duty as Activision’s ‘key product franchise’,” the FTC said, adding that “from its launch in 2003 up through 2020, it generated $27 billion in revenues”–making it “one of the most successful console-game franchises ever.”
In response, Microsoft prefaced it by saying “this case involves a transaction between the third-place manufacturer of gaming consoles and one of many publishers of popular video games.”
“Xbox started behind Nintendo and Sony when it began making consoles 20 years ago, and it remains in third place today. Xbox also has next to no presence in mobile gaming, the fastest-growing segment of gaming and the place where 94% of gamers spend their time today,” Microsoft replied.
In essence, the firm explained that it is “good business” to offer Activision’s titles to a broader selection of gaming platforms, not by making it exclusive to one.
“A substantial portion of Activision’s financial value to Xbox comes from business as usual, including the continued sale of Call of Duty—its most popular game—on Sony’s PlayStation. Paying $68.7 billion for Activision makes no financial sense if that revenue stream goes away,” the firm further explained.
Microsoft also added that should it make Call of Duty exclusive, the “reputational hit to Xbox would not be worth any theoretical economic benefit from taking Call of Duty away from competitors.”
As it has maintained, the firm promised to keep Call of Duty on PlayStation “from the moment this deal was announced.” Xbox’s proposal to its competitor extends the offering for “ten years—an unheard-of length for contracts in the gaming industry.”
“Xbox has made this same offer to other competitors, and at least one (Nintendo) has accepted to date. Sony refuses to deal,” the firm said, highlighting that “the fact that Xbox’s dominant competitor has thus far refused to accept Xbox’s proposal does not justify blocking a transaction that will benefit consumers.”
“The acquisition of a single game by the third-place console manufacturer cannot upend a highly competitive industry,” Microsoft summed.
In outlining its complaint, the FTC cited Microsoft’s past acquisition deal to buy ZeniMax Media in March 2021. ZeniMax Media is the parent company of game developer and publisher Bethesda Softworks.
The commission noted that while Microsoft pledged that it “would not have the incentive to withhold ZeniMax titles from rival consoles” during the antitrust review by the European Commission (EC), the firm still made three of the newly-acquired games exclusive to its platform–Starfield, Redfall, and Elder Scrolls VI.
“Although previous titles in ZeniMax’s [redacted] franchise were released on PlayStation, Microsoft has confirmed that the upcoming [redacted] will be available only on Xbox consoles, Windows PCs, and Xbox Game Pass subscription services,” the commission added.
The FTC also noted that Microsoft then announced “Starfield and Redfall, two of the highly anticipated new titles under development at the time of Microsoft’s acquisition of ZeniMax, will be Xbox platform and Xbox Game Pass exclusives when they are released.”
“Microsoft’s past behavior should also cast more suspicion on its non-binding public commitments to keep Call of Duty available on PlayStation consoles through the end of Activision’s existing agreement with Sony,” said the commission.
But for Microsoft, the ZeniMax transaction “has no relevance to the current transaction.” The firm further asserted that ZeniMax’s first two new titles were made exclusive to PlayStation for a year after the purchase completed.
In explaining why it made ZeniMax’s three future titles exclusive to Xbox and PCs, Microsoft explained that these were all “designed to be played primarily alone or in small groups.” However, it touted that it continued to release new updates of existing ZeniMax games such as Fallout 76 and Elder Scrolls Online on both Xbox and PlayStation, “because these games are designed to be played together by broad communities of gamers on different platforms,” adding that the latter set of games should be considered the ones that are more analogous to the Call of Duty game.
“Any suggestion that Microsoft’s statements to the European Commission about ZeniMax were misleading is incorrect. Microsoft explicitly said it would honor Sony’s existing exclusivity rights and approach exclusivity for future game titles on a case-by-case basis, which is exactly what it has done,” the firm reiterated.
The EC also agrees it was not misled, saying Microsoft did not make any “commitments” nor did the commission “rely on any statements made by Microsoft about the future distribution strategy concerning ZeniMax’s games” when it made the decision to approve the acquisition.
The FTC is suing the acquisition deal for the violation of Section 5 of the Federal Trade Commission Act and Section 7 of the Clayton Act, asking the court to prohibit “any transaction between Microsoft and Activision that combines their businesses.”
If the combination ensues, the FTC asked the court to order the merging firms to divest and reconstitute “all associated and necessary assets” in a way that they will function as two or more distinct and separate businesses. The commission also requests that the firms will not “acquire, merge with, consolidate, or combine their businesses with any other company engaged in business activity in the relevant markets” for a period of time following the acquisition.
For its part, Microsoft said that the commission “cannot provide clear proof that the combination of Microsoft’s gaming business and Activision’s business would restrain trade” in the relevant markets.
“The combination of Microsoft’s gaming business with Activision’s business will be procompetitive. The transaction will result in substantial acquisition-specific efficiencies, synergies, and other procompetitive effects that will directly benefit consumers,” the firm summed up.
Activision stated in its own response to the FTC’s lawsuit that “taking Call of Duty exclusive would be disastrous for Xbox.”
“If Xbox withheld Call of Duty from Sony’s PlayStation or other platforms that compete with Xbox, Xbox would immediately forgo billions of dollars in lost game sales and cleave off a massive portion of the garners that Activision has worked so hard to attract and retain,” the game publisher said.
The company added that it is “facially absurd and contradicted by the plain facts” for the FTC to assume “that a gaming platform cannot succeed without Call of Duty.”
Outside of the United States, Brazil approved the deal, while the United Kingdom is reviewing it.
The FTC suit follows a legal battle put forth by a group of video gamers, suing Microsoft to also stop the pending Activision acquisition for potential stifling of the competition.
The case was filed late Tuesday in a federal court in San Francisco on behalf of ten individual gamers who enjoy Activision Blizzard’s Call of Duty franchise as well as other popular titles like World of Warcraft, Overwatch, and Diablo.
According to the lawsuit, the proposed acquisition would give Microsoft “far-outsized market power in the video game industry,” with the capacity to “foreclose rivals, limit output, reduce consumer choice, raise prices, and further inhibit competition.”
Several of the plaintiffs in the private antitrust complaint stated that they play Activision Blizzard games on Sony’s PlayStation, Microsoft’s primary rival. Others stated that they play them on their laptops, Xbox, or Nintendo’s Switch.
As it had previously stated, Microsoft responded to the suit, saying that the merger “will expand competition and create more opportunities for gamers and game developers as we seek to bring more games to more people.”
It was back in January 2022 that Microsoft announced the plan to acquire Activision at US$95 per share.
Microsoft last traded at US$238.73 while Activision last traded at US$75.95 on the Nasdaq.
Information for this briefing was found via BBC, CNBC, and the sources mentioned. The author has no affiliations related to this organization. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.
SAN FRANCISCO (AP) — Artificial intelligence‘s recent rise to the forefront of business has left most office workers wondering how often they should use the technology and whether a computer will eventually replace them.
Those were among the highlights of a recent study conducted by the workplace communications platform Slack. After conducting in-depth interviews with 5,000 desktop workers, Slack concluded there are five types of AI personalities in the workplace: “The Maximalist” who regularly uses AI on their jobs; “The Underground” who covertly uses AI; “The Rebel,” who abhors AI; “The Superfan” who is excited about AI but still hasn’t used it; and “The Observer” who is taking a wait-and-see approach.
Only 50% of the respondents fell under the Maximalist or Underground categories, posing a challenge for businesses that want their workers to embrace AI technology. The Associated Press recently discussed the excitement and tension surrounding AI at work with Christina Janzer, Slack’s senior vice president of research and analytics.
Q: What do you make about the wide range of perceptions about AI at work?
A: It shows people are experiencing AI in very different ways, so they have very different emotions about it. Understanding those emotions will help understand what is going to drive usage of AI. If people are feeling guilty or nervous about it, they are not going to use it. So we have to understand where people are, then point them toward learning to value this new technology.
Q: The Maximalist and The Underground both seem to be early adopters of AI at work, but what is different about their attitudes?
A: Maximalists are all in on AI. They are getting value out of it, they are excited about it, and they are actively sharing that they are using it, which is a really big driver for usage among others.
The Underground is the one that is really interesting to me because they are using it, but they are hiding it. There are different reasons for that. They are worried they are going to be seen as incompetent. They are worried that AI is going to be seen as cheating. And so with them, we have an opportunity to provide clear guidelines to help them know that AI usage is celebrated and encouraged. But right now they don’t have guidelines from their companies and they don’t feel particularly encouraged to use it.
Overall, there is more excitement about AI than not, so I think that’s great We just need to figure out how to harness that.
Q: What about the 19% of workers who fell under the Rebel description in Slack’s study?
A: Rebels tend to be women, which is really interesting. Three out of five rebels are women, which I obviously don’t like to see. Also, rebels tend to be older. At a high level, men are adopting the technology at higher rates than women.
Q: Why do you think more women than men are resisting AI?
A: Women are more likely to see AI as a threat, more likely to worry that AI is going to take over their jobs. To me, that points to women not feeling as trusted in the workplace as men do. If you feel trusted by your manager, you are more likely to experiment with AI. Women are reluctant to adopt a technology that might be seen as a replacement for them whereas men may have more confidence that isn’t going to happen because they feel more trusted.
Q: What are some of the things employers should be doing if they want their workers to embrace AI on the job?
A: We are seeing three out of five desk workers don’t even have clear guidelines with AI, because their companies just aren’t telling them anything, so that’s a huge opportunity.
Another opportunity to encourage AI usage in the open. If we can create a culture where it’s celebrated, where people can see the way people are using it, then they can know that it’s accepted and celebrated. Then they can be inspired.
The third thing is we have to create a culture of experimentation where people feel comfortable trying it out, testing it, getting comfortable with it because a lot of people just don’t know where to start. The reality is you can start small, you don’t have to completely change your job. Having AI write an email or summarize content is a great place to start so you can start to understand what this technology can do.
Q: Do you think the fears about people losing their jobs because of AI are warranted?
A: People with AI are going to replace people without AI.
WASHINGTON (AP) — The Biden administration said Tuesday that it would provide up to $325 million to Hemlock Semiconductor for a new factory, a move that could help give Democrats a political edge in the swing state of Michigan ahead of election day.
The funding would support 180 manufacturing jobs in Saginaw County, where Republicans and Democrats were neck-in-neck for the past two presidential elections. There would also be construction jobs tied to the factory that would produce hyper-pure polysilicon, a building block for electronics and solar panels, among other technologies.
Commerce Secretary Gina Raimondo said on a call with reporters that the funding came from the CHIPS and Science Act, which President Joe Biden signed into law in 2022. It’s part of a broader industrial strategy that the campaign of Vice President Kamala Harris, the Democratic nominee, supports, while Republican nominee Donald Trump, the former president, sees tariff hikes and income tax cuts as better to support manufacturing.
“What we’ve been able to do with the CHIPS Act is not just build a few new factories, but fundamentally revitalize the semiconductor ecosystem in our country with American workers,” Raimondo said. “All of this is because of the vision of the Biden-Harris administration.”
A senior administration official said the timing of the announcement reflected the negotiating process for reaching terms on the grant, rather than any political considerations. The official insisted on anonymity to discuss the process.
After site work, Hemlock Semiconductor plans to begin construction in 2026 and then start production in 2028, the official said.
Running in 2016, Trump narrowly won Saginaw County and Michigan as a whole. But in 2020 against Biden, both Saginaw County and Michigan flipped to the Democrats.
Although no one likes a know-it-all, they dominate the Internet.
The Internet began as a vast repository of information. It quickly became a breeding ground for self-proclaimed experts seeking what most people desire: recognition and money.
Today, anyone with an Internet connection and some typing skills can position themselves, regardless of their education or experience, as a subject matter expert (SME). From relationship advice, career coaching, and health and nutrition tips to citizen journalists practicing pseudo-journalism, the Internet is awash with individuals—Internet talking heads—sharing their “insights,” which are, in large part, essentially educated guesses without the education or experience.
The Internet has become a 24/7/365 sitcom where armchair experts think they’re the star.
Not long ago, years, sometimes decades, of dedicated work and acquiring education in one’s field was once required to be recognized as an expert. The knowledge and opinions of doctors, scientists, historians, et al. were respected due to their education and experience. Today, a social media account and a knack for hyperbole are all it takes to present oneself as an “expert” to achieve Internet fame that can be monetized.
On the Internet, nearly every piece of content is self-serving in some way.
The line between actual expertise and self-professed knowledge has become blurry as an out-of-focus selfie. Inadvertently, social media platforms have created an informal degree program where likes and shares are equivalent to degrees. After reading selective articles, they’ve found via and watching some TikTok videos, a person can post a video claiming they’re an herbal medicine expert. Their new “knowledge,” which their followers will absorb, claims that Panda dung tea—one of the most expensive teas in the world and isn’t what its name implies—cures everything from hypertension to existential crisis. Meanwhile, registered dietitians are shaking their heads, wondering how to compete against all the misinformation their clients are exposed to.
More disturbing are individuals obsessed with evangelizing their beliefs or conspiracy theories. These people write in-depth blog posts, such as Elvis Is Alive and the Moon Landings Were Staged, with links to obscure YouTube videos, websites, social media accounts, and blogs. Regardless of your beliefs, someone or a group on the Internet shares them, thus confirming your beliefs.
Misinformation is the Internet’s currency used to get likes, shares, and engagement; thus, it often spreads like a cosmic joke. Consider the prevalence of clickbait headlines:
You Won’t Believe What Taylor Swift Says About Climate Change!
This Bedtime Drink Melts Belly Fat While You Sleep!
In One Week, I Turned $10 Into $1 Million!
Titles that make outrageous claims are how the content creator gets reads and views, which generates revenue via affiliate marketing, product placement, and pay-per-click (PPC) ads. Clickbait headlines are how you end up watching a TikTok video by a purported nutrition expert adamantly asserting you can lose belly fat while you sleep by drinking, for 14 consecutive days, a concoction of raw eggs, cinnamon, and apple cider vinegar 15 minutes before going to bed.
Our constant search for answers that’ll explain our convoluted world and our desire for shortcuts to success is how Internet talking heads achieve influencer status. Because we tend to seek low-hanging fruits, we listen to those with little experience or knowledge of the topics they discuss yet are astute enough to know what most people want to hear.
There’s a trend, more disturbing than spreading misinformation, that needs to be called out: individuals who’ve never achieved significant wealth or traded stocks giving how-to-make-easy-money advice, the appeal of which is undeniable. Several people I know have lost substantial money by following the “advice” of Internet talking heads.
Anyone on social media claiming to have a foolproof money-making strategy is lying. They wouldn’t be peddling their money-making strategy if they could make easy money.
Successful people tend to be secretive.
Social media companies design their respective algorithms to serve their advertisers—their source of revenue—interest; hence, content from Internet talking heads appears most prominent in your feeds. When a video of a self-professed expert goes viral, likely because it pressed an emotional button, the more people see it, the more engagement it receives, such as likes, shares and comments, creating a cycle akin to a tornado.
Imagine scrolling through your TikTok feed and stumbling upon a “scientist” who claims they can predict the weather using only aluminum foil, copper wire, sea salt and baking soda. You chuckle, but you notice his video got over 7,000 likes, has been shared over 600 times and received over 400 comments. You think to yourself, “Maybe this guy is onto something.” What started as a quest to achieve Internet fame evolved into an Internet-wide belief that weather forecasting can be as easy as DIY crafts.
Since anyone can call themselves “an expert,” you must cultivate critical thinking skills to distinguish genuine expertise from self-professed experts’ self-promoting nonsense. While the absurdity of the Internet can be entertaining, misinformation has serious consequences. The next time you read a headline that sounds too good to be true, it’s probably an Internet talking head making an educated guess; without the education seeking Internet fame, they can monetize.
