Communications Workers of America (CWA) President Claude Cummings Jr. is calling on U.S. regulators to scrutinize EA proposed privatization of $55 billion over concerns that it would jeopardize “thousands of jobs and sensitive consumer data.” CWA currently represents more than 4,000 unionized video game workers in the United States.
EA is in the process of being acquired by a consortium of investors that includes Saudi sovereign wealth fund PIF and an investment firm co-founded by Donald Trump's son-in-law Jared Kushner.
The news was alarming for a number of reasons, including the Saudi regime's poor human rights record and the fact that it is financed by $20 billion in debt.
In response, Cummings Jr. sent official letters to both Federal Trade Commission (FTC) and Committee on Foreign Investment in the United States (CFIUS) to call for a comprehensive renegotiation of the agreement to address a host of labor, market, and national security issues.
“As workers and consumers look to the American economy to strengthen and revitalize our families, CWA members believe there are several issues the Commission should examine when considering this important acquisition, particularly the implications for consolidation in the video game industry, increased vertical integration and the potential for greater isolation in multiple related business lines, potential interlocking directorates, and the impact of the acquisition on EA's bargaining power in local labor markets in light of EA's current wage-setting authority,” Cummings Jr. said in his letter to the Federal Trade Commission.
When assessing the ransom analysts recently told Game Developer the deal could lead to layoffs and asset sales. EA itself said the move would not lead to “immediate” layoffsbut this word does not imply long-term stability. As such, Cummings Jr. has tasked the Federal Trade Commission with proving it “supports” workers across the United States by examining EA's current labor market power and assessing how the deal could give the publisher “even greater power and incentive to pressure workers.”
Additional national security concerns were outlined in a letter to CFIUS.
“We believe this acquisition may increase critical national security risks due to EA's access to and collection of sensitive personal data from millions of American consumers, as well as the ongoing and planned development of artificial intelligence (AI) technology,” Cummings Jr. added in a letter addressed to CFIUS Committee Chairman Scott Bessent.. “For these reasons, we encourage the Committee on Foreign Investment in the United States (CFIUS or the Committee) to carefully review this proposed acquisition.”
Cummings Jr. said CFIUS should consider whether it is comfortable handing over “player data sets,” many of which he claims will belong to children and teenagers, to foreign investors.
He suggested that the data collected by video game companies such as EA is similar to information collected by social media platforms such as TikTok, which were forced to hand over control of some operations to a US consortium after the US Department of Justice said the Chinese-owned platform posed a “huge and widespread national security threat”.
“The federal government is now finalizing what amounts to a forced sale of TikTok's U.S. operations to Chinese-owned ByteDance based on significant national security concerns related to a foreign government's access to Americans' sensitive user data through their use of the social media app,” Cummings Jr. added.
“Due to the similarities between modern video game companies such as EA and social media platforms such as TikTok, as well as the level of access to sensitive US data that the Saudi Arabian government may have, the committee should evaluate PIF's proposed buyout of EA with the same scrutiny.”
Cummings Jr. isn't the only one calling on regulators to take action. Earlier this month EA workers in tandem with members of the United Videogame Workers-CWA Local 9433 called on officials and regulators to take a long, hard look at the deal to ensure that “any path forward protects jobs, preserves creative freedom, and ensures decision-making is held accountable to the workers who make EA successful.”
