Communications Workers of America (CWA) president Claude Cummings Jr is urging regulators in the United States to scrutinize EA’s proposed $55 billion take-private over concerns it will place “thousands of jobs and sensitive consumer data at risk.” The CWA currently represents over 4,000 unionized video game workers across the United States.
EA is in the process of being acquired by an investor consortium that includes the Saudi sovereign wealth fund, PIF, and the investment firm co-founded by Donald Trump’s son-in-law Jared Kushner.
The news has raised alarm bells for a number of reasons, including the poor human rights record of the Saudi regime and the fact it is being financed with $20 billion of leveraged debt.
In response, Cummings Jr has sent formal letters to both the Federal Trade Commission (FTC) and Committee on Foreign Investment in the United States (CFIUS) to call for a comprehensive review of the deal to address a myriad of labor, market, and national security concerns.
“As workers and consumers hoping to see the American economy strengthened and revitalized for our families, CWA members believe there are several questions the Commission should examine as it considers this high-stakes acquisition, in particular the implications regarding consolidation in the video game industry, increased vertical integration and the potential for greater exclusionary conduct across multiple related business lines, potential interlocking directorates, and the impact of the acquisition on EA’s market power in local labor markets in light of EA’s current wage-setting power,” said Cummings Jr in his letter to the FTC.
When assessing the buyout, analysts recently told Game Developer the deal could lead to layoffs and divestments. EA itself said the move won’t result in “immediate” redundancies, but that isn’t a word that implies long-term stability. As such, Cummings Jr told the FTC to prove it “has the back” of working people across the United States by investigating EA’s current labor market power and assessing how the transaction could give the publisher “even greater ability and incentive to squeeze workers.”
Additional national security concerns were outlined in a letter to the CFIUS.
“We believe this acquisition may raise critical national security risks due to EA’s access to and collection of sensitive personal data from millions of American consumers and current and planned development of artificial intelligence (AI) technology,” added Cummings Jr in a letter addressed to CFIUS committee chair, Scott Bessent. “For these reasons, we urge the Committee on Foreign Investment in the United States (CFIUS or the Committee) to closely scrutinize this proposed acquisition.”
Cummings Jr said CFIUS must consider whether it’s comfortable handing over “troves of player data,” many of which he claims will belong to children and teens, to foreign investors.
He suggested that data gathered by video game companies like EA is similar to the information obtained by social media platforms like TikTok, which has been forced to surrender control of some operations to a U.S. consortium after the U.S. Justice Department said the Chinese-owned platform posed “a national-security threat of immense depth and scale.”
“The federal government is currently in the process of finalizing what amounts to a forced sale of TikTok’s U.S. operations from Chinese-owned ByteDance based on significant national security concerns related to a foreign government’s access to sensitive user data from Americans via their use of a social media app,” added Cummings Jr.
“Because of the similarities between modern video game companies like EA and social media platforms like TikTok and the level of access to sensitive American data the Saudi government may gain, the Committee should evaluate this proposed buyout of EA by PIF with similarly intense scrutiny.”
Cummings Jr isn’t alone in calling on regulators to take action. Earlier this month, EA workers in tandem with union members of United Videogame Workers-CWA Local 9433 implored officials and regulators to take a long, hard look at the deal to ensure “any path forward protects jobs, preserves creative freedom, and keeps decision-making accountable to the workers who make EA successful.”
