Adobe-Figma Deal Likely To Attract Antitrust Scrutiny (axios.com) 9
An anonymous reader quotes a report from Axios: Some users of Figma's design software reacted with dismay on Thursday when they found out the company was going to be acquired by Adobe, the unloved giant in the space. Other observers immediately concluded that the acquisition looks downright illegal under antitrust laws.
Why it matters: The Biden administration is on the record as wanting to beef up antitrust enforcement. The Figma deal, at $20 billion, is certainly large enough to grab the attention of regulators. The big question is whether they'll conclude that suing to block it is a case they can win. Either the Department of Justice or the Federal Trade Commission could review the merger; both have taken a renewed interest in software and digital mergers.
Between the lines: The Clayton Antitrust Act says any acquisition that would reduce competition in an industry is illegal. Figma was founded as an Adobe competitor and has grown impressively by doing exactly that -- implying there's a case to be made that this acquisition is anti-competitive. Insofar as Adobe is already the dominant player in the space, any acquisition, let alone a $20 billion one, will be looked at carefully. "The fact that Adobe is not typically identified as a Big Tech platform should provide [Adobe and Figma] with little if any comfort," Charles Rule, a partner at the Rule Garza Howley law firm and former DOJ antitrust official, tells Axios. "This deal appears to raise straightforward, traditional antitrust issues," he says.
"There's enough here to get a close look, and maybe a complaint," adds a former FTC antitrust official. Another former FTC attorney tells Axios to expect a thorough initial investigation into possible overlaps.
Why it matters: The Biden administration is on the record as wanting to beef up antitrust enforcement. The Figma deal, at $20 billion, is certainly large enough to grab the attention of regulators. The big question is whether they'll conclude that suing to block it is a case they can win. Either the Department of Justice or the Federal Trade Commission could review the merger; both have taken a renewed interest in software and digital mergers.
Between the lines: The Clayton Antitrust Act says any acquisition that would reduce competition in an industry is illegal. Figma was founded as an Adobe competitor and has grown impressively by doing exactly that -- implying there's a case to be made that this acquisition is anti-competitive. Insofar as Adobe is already the dominant player in the space, any acquisition, let alone a $20 billion one, will be looked at carefully. "The fact that Adobe is not typically identified as a Big Tech platform should provide [Adobe and Figma] with little if any comfort," Charles Rule, a partner at the Rule Garza Howley law firm and former DOJ antitrust official, tells Axios. "This deal appears to raise straightforward, traditional antitrust issues," he says.
"There's enough here to get a close look, and maybe a complaint," adds a former FTC antitrust official. Another former FTC attorney tells Axios to expect a thorough initial investigation into possible overlaps.
Gotta say (Score:2)
True antitrust enforcement in the USA is usually a figma of our imagination.
Re: (Score:2)
And it will remain that way until proven.
Pretty telling when the only real reason Adobe raised the ire of anti-trust was "The fact that Adobe is not typically identified as a Big Tech platform..."
Translation: They didn't quite put enough zeros on that check, like the rest of the Donor Class does. But you know, elections are coming up...
Great joke idea (Score:2)
I think it would be cool if I can somehow contrive a joke that involves me saying "it was a figma-nt of their imagination." Something like "they thought this merger would be a good idea, but it turned out to be a figmant of their imagination" .. 3/10?
Re: (Score:2)
... 3/10?
Your joke rating may depend on other related factors.
For example, are you a Dad with some grey hair who enjoys slapping your own knee after making such a comment? 'Cause that guy gets an 11/10.
"Illegal" (Score:2)
> Between the lines: The Clayton Antitrust Act says any acquisition that would reduce competition in an industry is illegal.
If only anyone in government paid attention.
T-Mobile acquired SPRINT. Number of wireless telephone service providers competing with each other decreased, and competition decreased.
Amazon bought iRobot. Same comments.
AstraZeneca bough Alexion...
Disney bought 21st Century Fox...
Discovery acquired Warner Media...
Those are just five multi billion dollar deals within the last few month
Re: (Score:3)
Here's the problem in a nutshell.
Antitrust is being defined as the removal of a competitor. Not the destruction of one once acquired.
AutoDesk should never have been able to acquire Maya and Softimage, but it did, and now Softimage is extinct and Maya is pretty much a dead product to learn.
Adobe acquired Macromedia, destroyed all their products, and then went subscription only.
It is NOT in any software industry's interest to see the merger of a company if it will result in two similar products being owned by
Re: (Score:2)
"Adobe buying Maya", Autodesk, not Adobe. Adobe should have been required to spin off Macromedia's products instead of shutting them down. Notice how Flash was the only product that ever got integrated into Adobe's software ecosystem, and then subsequently didn't improve it very much until it got traction as a video player, and then subsequently got disposed of?
Seems like SOP for Adobe (Score:2)
Isn't this typically how they've "competed" in the past - by buying out their competitor? Remember Aldus? Remember Macromedia?