Antitrust used to be a niche. Known to practitioners and experts, of course. Cases were kept, progressed, and negotiated in that environment. Those times are long gone. We have seen an increasing trend towards companies turning to publicity and PR campaigns as a tool in both merger control and antitrust proceedings. PR work is used to influence public opinion and regulators to a certain extent – they do not operate in a vacuum, after all. This post picks up showcases for the intersection between PR and antitrust, and explores benefits and drawbacks of taking cases public.
I have long been particularly interested in the space where substantive antitrust issues, political implications and public attention intersect (does the motto of this blog give that away?). There seem to be more and more of these cases out there. Are there really? Or has antitrust just become more political and “charged” with solving all kinds of issues?
That question is a recurring theme in our blog, which I will not go into here. The answer to the question does not necessarily matter – all stakeholders need to face and adapt to the reality of what antitrust cases are made of these days:
Games and gamers
In its planned acquisition of Activision, Microsoft re-defined the way of how one can run a PR campaign regarding a merger control proceeding (more on the overall deal here). When the UK regulator moved towards blocking the deal, Microsoft ran full page ads (!!) in the Financial Times and the Daily Mail reading “Call of Duty. For 150 million more players”. So, in parallel to engaging with the regulator, Microsoft tried to win over newspaper readers in favour of the commitments the company was offering in the course of the merger control proceedings.
The regulator ended up blocking the deal nevertheless, which will now be fought over in court. Once the prohibition was out, PR kicked in again. Management expressing a certain frustration with regulators is not entirely unseen. However, Activision took a particularly aggressive approach:
Activision’s CEO was quoted saying that the CMA was being used as a tool by the US regulator (which also tried/tries to block the deal), and the company itself ran an industry policy angle by saying that the prohibition “contradicts the ambitions of the UK to become an attractive country to build technology businesses”, was a “disservice to UK citizens, who face increasingly dire economic prospects” and that global innovators would note that “the UK is clearly closed for business”.
Now, that is quite a rhetoric, and maybe not the words of someone who intends to show up at the regulator with another case anytime soon. Whether the parties will ultimately be successful in overturning the prohibition in court is of course another matter.
Talking about industry policy
Microsoft/Activision might have moved the boundaries today, but there is a predecessor that did the same not so long ago. Here comes a case that is already a classic and in 2019 itself redefined PR and merger control: The failed merger of Siemens’ and Alstom’s rail business.
The transaction was pitched as creating a European Champion, necessary to counter the presence of Chinese competitors on global markets. The parties drew support from very senior politicians, with both the French and the German ministers of economic affairs speaking out in favour of the transaction. They even went as far as confirming publicly whether or not the parties would be willing to make concessions to the European Commission, which was reviewing the deal.
Despite immense pressure from two of its largest Member States, the Commission remained firm and blocked the transaction. With a certain parallel to the reaction of Activision’s CEO to the UK prohibition, Siemens’ CEO at the time criticized the Commission in no uncertain terms even when the review was still ongoing. At a press conference, he said that it would “be interesting to see if the future of mobility will be determined by backward-looking technocrats or future-oriented Europeans”, which followed a twitter post saying that “it must be bitter to be technically right but to do everything wrong for Europe”…
Music, mobile, retail
While Siemens/Alstom certainly was not the first case that was dragged into caught a more public eye, it kind of marked a paradigm shift. Between then and Microsoft/Activision, one could observe an increasing number of deals played with a PR angle:
Not very long after the Siemens/Alstom prohibition, Spotify filed a complaint against Apple at the European Commission. In most cases, complainants act discretely and would prefer for a regulator to run an investigation instead of the complainant being in the spotlight. Different for Spotify: Alongside its complaint, it launched a website dedicated to its case, describing what the case is about, with updates on where things stand.
That playbook was followed by games maker Epic when it went after Apple in 2020 and launched a “Free Fortnite” campaign to keep the public abreast of its (still ongoing) antitrust dispute with Apple. Another example of PR strategies and antitrust is the dispute between retailers and manufacturers of consumer goods over purchasing alliances, which is fought publicly (more here).
Interestingly, the potentially most heavily lobbied area in antitrust is still to see an open PR campaign addressed to an audience beyond politicians and regulators: Even though there is a lot of more or less open lobbying around standard essential patents, the issues rarely reach a broad public eye.
So, win a case via PR?
PR will not win antitrust cases, but it can help. These are three key takeaways from what recent years have shown us:
- PR campaigns can be effective in influencing public opinion and also in putting pressure on regulators. The more of a public role antitrust regulators take, the more they are also exposed to public expectations. While companies will try to use that in their favour, they in turn must be prepared for the spotlight when they decide to add a PR angle to their case.
- PR work cannot replace robust and well-prepared evidence. Companies have to provide such evidence to win their cases.
- To really have an impact, PR campaigns must be led by experienced professionals who work hand in hand and with clear responsibilities with lawyers and other advisors.
All of that said, overall antitrust proceedings (including merger control) will hopefully continue to be based on evidence and legal analysis, and not on what the public opinion might be.
Photo by Elena Mozhvilo on Unsplash
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