Microsoft negs Activision Blizzard to push through $68.7 billion acquisition

Microsoft is taking an interesting approach to secure regulatory approval for its acquisition of Activision Blizzard. In a recent filing spotted by Rock Paper Shotgun, the company told New Zealand’s Commerce Commission the troubled publisher produces n…

FTC moves to block Meta’s purchase of ‘Supernatural’ VR workout app maker Within

The Federal Trade Commission has filed an antitrust suit against Meta in a bid to block it from buying Within Unlimited, the maker of the virtual reality workout app Supernatural. The agency accused the company and its CEO Mark Zuckerberg of “planning to expand Meta’s virtual reality empire with this attempt to illegally acquire a dedicated fitness app that proves the value of virtual reality to users.”

The FTC claimed that Meta is “already a key player” at every level of the VR ecosystem. It said the company has the top-selling VR device (Meta Quest 2), a leading VR app store, “seven of the most successful developers and one of the best-selling apps of all time.” The latter is likely referring to Beat Saber. Meta bought the maker of that rhythm game, Beat Games, in 2019.

“Instead of competing on the merits, Meta is trying to buy its way to the top,” John Newman, deputy director of the FTC’s Bureau of Competition, said in a statement. “Meta already owns a best-selling virtual reality fitness app and it had the capabilities to compete even more closely with Within’s popular Supernatural app. But Meta chose to buy market position instead of earning it on the merits. This is an illegal acquisition and we will pursue all appropriate relief.”

Meta announced its plan to buy Within last October. It was reported in December that the FTC was looking into the $400 million deal. Meta, of course, got into the VR market in the first place when it bought Oculus in 2014.

The FTC argues in the complaint that Meta has the resources and “reasonable probability” of entering the VR fitness market by building its own app. That approach, the agency claims, would “increase consumer choice, increase innovation, spur additional competition to attract the best employees, and yield other competitive benefits.” Instead, if it were to buy Within, the FTC claims Meta would limit “future innovation and competitive rivalry” and says “that lessening of competition violates the antitrust laws.”

“The FTC’s case is based on ideology and speculation, not evidence. The idea that this acquisition would lead to anticompetitive outcomes in a dynamic space with as much entry and growth as online and connected fitness is simply not credible,” a Meta spokesperson told Engadget in a statement. “By attacking this deal in a 3-2 vote, the FTC is sending a chilling message to anyone who wishes to innovate in VR. We are confident that our acquisition of Within will be good for people, developers and the VR space.” 

The move will come as another blow to Meta’s aim to become the leading metaverse player. The company has plowed billions into the effort, though in recent months it has dialed back some of its ambitions by cutting costs and reportedly shelving plans for some devices that were supposed to hook into its metaverse. This week, the company announced that it will increase the price of a Meta Quest 2 headset by $100 as of August 1st. News of the FTC’s move to block the Within acquisition comes on the same day that Meta will report its earnings for the second quarter of 2022.

Update 7/27 7:41PM ET: Meta has since published a blog post called “The FTC’s Attempt to Block Meta’s Acquisition of Within Is Wrong on the Facts and the Law.” You can probably guess the company’s stance on the matter from that title alone. 

Two of Europe’s biggest internet satellite companies are merging to take on Starlink

Internet satellite operators OneWeb and Eutelsat are planning to merge in the hopes of becoming a stronger rival to SpaceX’s Starlink. The merger, which is subject to approval from regulators and Eutelsat shareholders, is expected to close by mid-2023 and it values OneWeb at $3.4 billion. Shareholders of OneWeb and Eutelsat will each own half of the combined company.

Eutelsat has a fleet of 36 geostationary orbit satellites. These will be combined with OneWeb’s cluster of low-earth orbit satellites, which can provide internet access from the skies. OneWeb currently has 428 satellites in orbit of a planned 648 in its first-generation network.

OneWeb and Eutelsat expect to have combined revenues of €1.2 billion ($1.56 billion) in the 2022-23 fiscal year. Eutelsat chair Dominique D’Hinnin and CEO Eva Berneke will remain in those positions in the merged entity. OneWeb investor Sunil Bharti Mittal will become co-chairman.

The merger comes after OneWeb stumbled in its bid to become a viable competitor to Starlink and Amazon’s Project Kuiper. OneWeb filed for Chapter 11 bankruptcy in March 2020 as it sought a buyer. The UK government and Mittal’s Bharti Global each paid $500 million for a 45 percent stake in OneWeb. The company secured additional funding in early 2021 to launch hundreds of satellites.

More recently, OneWeb was caught in the crossfire between Russia and the West following the former’s invasion of Ukraine. UK sanctions prompted Russia to block launches of OneWeb satellites — it demanded that the UK sell its stake in OneWeb and wanted assurances the satellites wouldn’t be used for military purposes. OneWeb ended up turning to its rival SpaceX to launch the remainder of its first-gen satellites.

After the expected merger, the UK will retain a “special share” in OneWeb as well as exclusive rights over the company. These grant the government a significant say in national security controls over the network and veto rights over certain decisions, such as the location of OneWeb’s headquarters.

Microsoft is giving Xbox Insiders free access to classic Bethesda first-person shooters

Microsoft is giving select PC gamers free access to four classic games by Bethesda and id Software, which it acquired as part of its $7.5 billion ZeniMax purchase in 2020. And three of them wouldn’t have been released if the tech giant isn’t acquiring Activision Blizzard, as well. In a post on the Xbox blog, Microsoft has revealed that Xbox Insiders on Windows PC can now preview Heretic: Shadow of the Serpent Riders, HeXen: Beyond Heretic, HeXen: Deathkings of the Dark Citadel, The Elder Scrolls: Arena and Quake Champions. 

It’s not surprising that the offer is only available for PC users part of Microsoft’s Insider program — as Ars Technica notes, the first four games in the list were originally released in the mid-90s and run via DOSBox emulation. DOSBox runs software for MS-DOS compatible games, but it’s a pretty inelegant solution for making old titles playable. 

The Elder Scrolls: Arena is an open-world action RPG published by Bethesda, with a first person perspective and features melee combat and magic. Meanwhile, Heretic, its sequel HeXen: Beyond Heretic and the latter’s expansion pack, HeXen: Deathkings of the Dark Citadel, are all first-person dark fantasy shooters. They were built using a modified version of the Doom engine, and though they were published by id Software, they were developed by Raven Software. Activision acquired the rights to those games when it purchased Raven in 1997.

Microsoft first announced that it’s purchasing Activision Blizzard for $68.7 billion in January this year and expects the deal to close no later than June 2023 if regulators give it their approval. It’s an all-cash deal that values Activision at $95 a share. Microsoft plans to add Activision Blizzard games to the Xbox Game Pass as part of the acquisition, and some of those games may be like the Heretic-HeXen series, which Activision doesn’t fully own.

Sony completes $3.6 billion deal to buy Bungie

The developer behind Destiny is now a part of the Sony universe. Sony Interactive Entertainment officially closed on a $3.6 billion deal today to buy the independent game studio and publisher Bungie, according to tweets from both Bungie and PlayStation…

Twitter lays off nearly 100 employees from its recruiting team

Twitter has laid off dozens of employees amid growing uncertainty around Elon Musk’s acquisition. The company cut 30 percent of its talent acquisition team, which includes recruiters and others charged with bringing on new hires, The Wall Street Journalreports. Twitter told The Journal that “fewer than 100 people” had been let go and that it was only the talent acquisition team that was affected.

Twitter had previously announced a partial hiring freeze as part of a broader attempt to cut costs as it attempts to finalize its acquisition by Elon Musk. The status of the deal is uncertain as Musk has threatened to pull out of the agreement, citing concerns about the number of bots on the platform. On Thursday, The Washington Postreported that the deal was in “serious jeopardy,” and that “it was likely a change in direction from Musk’s team would come soon.”

The subject of layoffs reportedly came up at recent Twitter all-hands with Musk. The Tesla CEO said he was concerned about costs at Twitter but didn’t directly answer a question about whether job cuts were on the table. “It depends,” he said, according to CNBC.

In a post on LinkedIn, Ingrid Johnson, a senior technical recruiter at Twitter, wrote that it was “a really tough day.” “There are people losing their jobs that have been there over a decade,” she wrote. “If Twitter has chosen to spend potential billions suing Elon and maintaining a falsely inflated stock price at the expense of the people who gave their lives building the company— that is an even more tragic story.”

Twitter isn’t the only tech company to recently pull back on hiring or lay off employees. Meta recently said it would slow its hiring as it faces “serious times.” Netflix, Unity, Coinbase and Paypal have all recently cut jobs as well.

UK’s antitrust watchdog investigating Microsoft and Activision megadeal

Microsoft will have to satisfy more than just the Federal Trade Commission to complete its $68.7 billion deal to buy Activision Blizzard. On Wednesday, the United Kingdom’s Competition and Markets Authority announced it would investigate the proposed m…

Geely buys majority stake in troubled phone maker Meizu

Chinese car giant Geely has purchased a majority stake in the now-small smartphone maker Meizu. Bloomberg reports that Meizu will be run as an independent company under Xingli Technology, another tech brand under Geely’s umbrella. That said, the pair a…

eBay purchases NFT art marketplace KnownOrigin

eBay truly has fully embraced non-fungible tokens: The e-commerce company has acquired KnownOrigin, an established marketplace for digital art NFTs. As CoinDesk notes, eBay hasn’t disclosed how much it paid for the marketplace, but it said in its announced that the purchase is an “important step in [its] tech-led reimagination.” KnownOrigin has been around since 2018 and gives artists a platform they can use to create and sell their art as NFTs in exchange for cryptocurrency payments. Based on information from DappRadar, which tracks data on decentralized apps, KnownOrigin has facilitated $7.8 million worth of NFT transactions since its inception. 

Jamie Iannone, eBay CEO, said in a statement:

“eBay is the first stop for people across the globe who are searching for that perfect, hard-to-find, or unique addition to their collection and, with this acquisition, we will remain a leading site as our community is increasingly adding digital collectibles.”

eBay made its first foray into NFTs as part of its “tech-led reimagination” last year. It allowed the sale of NFTs on its platform in May 2021 for sellers that meet the company’s standards. Back then, it told Reuters that it will add more capabilities “that bring blockchain-driven collectibles” to its platform. This May, the company launched an NFT collection of its own, releasing 13 limited-edition digital collectibles that feature 3D-animated renders of hockey legend Wayne Gretzky. In fact, we can expect the company to launch more NFT collections throughout the year. eBay and OneOf, its Web3 partner for the Gretzky drop, said they plan to release more NFTs in the coming months featuring other athletes and updated versions of iconic Sports Illustrated covers.

Microsoft formally agrees to respect Activision Blizzard unionization efforts

Microsoft has formally agreed to respect the right of Activision Blizzard workers to unionize in a pact with the Communications Workers of America. The agreement will be applied 60 days after Microsoft closes its acquisition of the video game publisher. The $68.7 billion takeover requires approval from regulators in various markets and is expected to close by the end of June 2023.

“This agreement provides a pathway for Activision Blizzard workers to exercise their democratic rights to organize and collectively bargain after the close of the Microsoft acquisition and establishes a high road framework for employers in the games industry,” CWA president Chris Shelton said in a statement. “Microsoft’s binding commitments will give employees a seat at the table and ensure that the acquisition of Activision Blizzard benefits the company’s workers and the broader video game labor market. The agreement addresses CWA’s previous concerns regarding the acquisition, and, as a result, we support its approval and look forward to working collaboratively with Microsoft after this deal closes.”

The agreement follows Microsoft announcing a set of “principles for employee organizing” earlier this month that did not contain much in the way of actual substance. The CWA pact is legally binding and centers around five core provisions. Microsoft laid those out as follows:

  • First, Microsoft will take a neutral approach when employees covered by the agreement express interest in joining a union.

  • Second, covered employees will be able to easily exercise their right to communicate with other employees and union representatives about union membership in a way that encourages information sharing and avoids business disruptions.

  • Third, employees will have access to an innovative technology-supported and streamlined process for choosing whether to join a union.

  • Fourth, employees can maintain confidentiality and privacy of that choice if they wish.

  • Fifth, if a disagreement arises between the CWA and Microsoft under the agreement, the two organizations will work together promptly to reach an agreement and will turn to an expedited arbitration process if they cannot.

“Earlier this month, we announced a set of principles that will guide our approach to labor organizations, and the Activision Blizzard acquisition is our first opportunity to put these principles into practice,” Microsoft president and vice chair Brad Smith said. “We appreciate CWA’s collaboration in reaching this agreement, and we see today’s partnership as an avenue to innovate and grow together.”

Microsoft and the CWA also agreed to explore other forms of collaboration. Among those are “joint opportunities for the US workforce to benefit from new technology and skill building programs that will enhance the country’s competitiveness.”

The arrangement formalizes much of Microsoft’s rhetoric about Activision Blizzard workers’ attempts to organize. Microsoft Gaming CEO and Xbox chief Phil Spencer reportedly said in an all-hands meeting in late May that “we would absolutely support [an] employees’ organization that’s in place.” Microsoft corporate vice president Lisa Tanzi previously said the company “respects Activision Blizzard employees’ right to choose whether to be represented by a labor organization and we will honor those decisions.”

The pact may also help Microsoft placate the Federal Trade Commission and antitrust regulators in other key markets as it tries to secure approval for its Activision Blizzard takeover. The publisher’s shareholders approved the proposed buyout almost unanimously in April.

Last month, quality assurance workers at Activision studio Raven Software voted to form the first union at a major video games company in North America. Activision Blizzard did not formally challenge the result of the election with the National Labor Relations Board. The company affirmed last week it would enter negotiations with the CWA, which is representing the workers.

Activision Blizzard is bound to conduct good faith negotiations over a collective bargaining agreement, though CEO Bobby Kotick warned that “may take some time to complete.” The company, which the CWA hasaccused of union busting, said in April it would hire 1,100 QA workers as permanent employees with higher minimum pay and benefits. However, it did not extend the same offer to the Raven workers who have organized as the Game Workers Alliance.