Microsoft Corp. MSFT has fired back at the Federal Trade Commission’s (FTC) allegations regarding layoffs following the purchase of Activision.
The FTC criticized Microsoft’s 1,900 layoffs, alleging they contradicted earlier promises made during the antitrust trial.
In response, Microsoft stated that Activision had already planned significant job cuts before the merger and condemned the FTC’s assertions as “incomplete and misleading,” The Verge reported.
Microsoft clarified, “Activision was already planning on eliminating a substantial number of jobs while still operating as an independent company.”
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The filing also noted that Activision’s pre-existing layoff plans aligned with industry trends impacting the gaming sector, consistent with layoffs announced by other gaming companies such as Sega Sammy Holdings Inc SGAMY and CI Games, reflecting wider industry challenges.
Microsoft had previously indicated that the layoffs were a result of identifying overlaps and the necessity for a sustainable cost structure. Microsoft Gaming CEO Phil Spencer emphasized this in a 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 undo the acquisition. As per Game Rant, 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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