More than 40 US Democrats call for a 'thorough investigation' of EA's Saudi-led buyout over risks of layoffs, studio closures, and 'coordinated anti-labor practices'

Three months after US senators Richard Blumenthal and Elizabeth Warren expressed “profound concern about the foreign influence and national security risks” that could result from the Saudi-led takeover of Electronic Arts, 46 House Democrats have joined the chorus with a letter calling on FTC chair Andrew Ferguson to “carefully scrutinize” the proposed takeover.

The letter’s signatories, led by Labor Caucus co-chairs Steven Horsford, Debbie Dingell, Mark Pocan, and Donald Norcross, say they have “serious concerns” that the acquisition will lead to layoffs, studio closures, wage suppression, and an unwelcome concentration of sports and entertainment brand ownership that could lead to “anticompetitive coordination.”

Median worker pay at EA has declined steeply year over year, the letter states, a trend that suggests the company “may already face limited competitive pressure to retain or reward talent.” It goes on to say that EA has eliminated more than 1,700 jobs since 2023 and warns that even deeper cuts could result if the acquisition is closed because of the massive debt financing involved, “which creates strong incentives for the acquiring firms to pursue further cost-cutting measures, including layoffs, offshoring, restructuring, or studio closures.”

The concerns expressed in the letter largely repeat what’s been previously been said by observers and analysts: Very generally, that the takeover is unlikely to be good for anyone except the extremely wealthy people behind it. Shortly after the acquisition was announced, PC Gamer’s Lincoln Carpenter put together a detailed explainer on leveraged buyouts and the risks they pose, and the less-than-glowing record of private equity management of acquired companies.

The letter does not mention (but I’m going to) the impact of Saudi ownership on future EA releases. Saudi Arabia is notoriously hostile to LGBTQ+ people, criminalizes same-sex relationships, and has a long history of repressing human rights for women and girls. That’s not a great ownership environment for games like The Sims and Dragon Age, both of which have come to be known for their embrace of diverse representation. And if you think that such things are beneath the notice of Saudi rulers, take a moment to sit back and think about why Ronaldo is in Fatal Fury: City of Wolves.

“The FTC’s 2023 Merger Guidelines make clear that mergers harming workers, suppressing wages, or enabling dominant firms to reduce labor demand may violate antitrust laws,” the letter states. “Given the scale of this acquisition and EA’s current dominance over the domestic videogame labor market, we believe careful scrutiny of this deal is essential. The transaction also raises serious concerns about interlocking directorates and common ownership across competing game publishers.

“This kind of overlap heightens the risk of coordinated anti-labor practices, including wage suppression, hiring restrictions, or informal no-poach dynamics and could further weaken the already limited bargaining power workers have in this industry. These risks should weigh heavily as the Commission evaluates whether the acquisition would leave workers more vulnerable to coordinated or unilateral harms.

Given that, you might expect the Electronic Arts acquisition to face some kind of meaningful resistance from US regulators. I suspect the opposite is more likely, however: US president Donald Trump is famously chummy with bin Salman, and Ferguson, the FTC chair, is a stalwart Trump supporter. Beyond that, one of the minority partners in the acquisition, Affinity Partners, is owned by Trump’s son-in-law Jared Kushner. The power of capital ultimately hammered the Microsoft-Activision deal through the system despite determined opposition from the FTC; now that there are effectively no roadblocks, I strongly suspect EA will go down much easier, no matter how many polite and respectful letters are sent.

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More than 40 US Democrats call for a 'thorough investigation' of EA's Saudi-led buyout over risks of layoffs, studio closures, and 'coordinated anti-labor practices'

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