The Federal Trade Commission said Thursday it is suing to block Microsoft’s planned $69 billion takeover of video game company Activision Blizzard, saying it could suppress competitors to its Xbox game consoles and its growing games subscription business.

The FTC voted 3-1 to issue the complaint after a closed-door meeting, with the three Democratic commissioners voting in favor and the sole Republican voting against. A fifth seat on the panel is vacant after another Republican left earlier this year.

The FTC’s complaint points to Microsoft’s previous game acquisitions, especially of well-known developer Bethesda Softworks and its parent company ZeniMax, as an example of where Microsoft made some popular game titles exclusive despite assuring European regulators it had no intention to do so.

“Microsoft has already shown that it can and will withhold content from its gaming rivals,” said a prepared statement from Holly Vedova, director of the FTC’s Bureau of Competition. “Today we seek to stop Microsoft from gaining control over a leading independent game studio and using it to harm competition in multiple dynamic and fast-growing gaming markets.”

Microsoft’s president, Brad Smith, suggested in a statement Thursday that the company is likely to challenge the FTC’s decision.

“While we believed in giving peace a chance, we have complete confidence in our case and welcome the opportunity to present our case in court,” Smith said.

The FTC’s challenge -- which is being filed in an administrative court -- could be a test case for President Joe Biden’s mandate to scrutinize big tech mergers.

Microsoft had been ramping up its public defense of the deal in recent days as it awaited a decision.

Microsoft announced the merger deal in January but has faced months of resistance from Sony, which makes the competing PlayStation console and has raised concerns with antitrust watchdogs around the world about losing access to popular Activision Blizzard game franchises such as Call of Duty.

Antitrust regulators under Biden “have staked out the view that for decades merger policy has been too weak and they’ve said, repeatedly, ‘We’re changing that,’” said William Kovacic, a former chair of the FTC.

The goal is to “not allow dodgy deals and not accept weak settlements,” said Kovacic, who was a Republican commissioner appointed in 2006 by then-President George W. Bush. But he said trying to block this acquisition could trigger a legal challenge from Microsoft that the company has a good chance of winning,

“It’s evident that the company has been making a number of concessions,” he said. “If the FTC turns down Microsoft’s commitments, Microsoft would likely raise them in court and say the FTC is being incorrigibly stubborn about this.”

Microsoft announced its latest promise Wednesday, saying it would make Call of Duty available on Nintendo devices for 10 years should its acquisition go through. It has said it tried to offer the same commitment to Sony.

The deal is also under close scrutiny in the European Union and the United Kingdom, where investigations aren’t due to be completed until next year.

CNN —

Amazon has agreed to pay more than $30 million to settle two federal lawsuits alleging that the tech giant violated users' privacy — including that of children — through its Alexa voice assistant and its Ring doorbell cameras.

Video above: Alexa’s celebrity voices are being discontinued

The twin settlements Wednesday with the Federal Trade Commission highlight claims that Amazon retained Ring videos and Alexa voice recordings, along with related geolocation information, for years – in some cases without consent and despite requests by consumers for the data to be deleted.

In addition, the FTC alleged that lax data policies at Amazon meant that the information could often be accessed by unauthorized parties — and often was, in the case of Ring doorbell footage.

Amazon acquired Ring in 2018, paving the way for the e-commerce giant to get into the home security business. In addition to video doorbells, Ring makes indoor and outdoor security cameras as well as alarm systems.

In a complaint accompanying the settlement, the FTC claimed Ring gave employees unrestricted access to videos from customers' home security systems. In one instance, the complaint states, a Ring employee viewed thousands of video recordings from at least 81 female users between June and August 2017, viewing cameras that users had assigned to bathrooms and bedrooms. An initial misconduct report by a fellow employee was not taken seriously, the complaint said.

"Only after the supervisor noticed that the male employee was only viewing videos of 'pretty girls' did the supervisor escalate the report of misconduct," the FTC alleged in the complaint. "Only at that point did Ring review a portion of the employee's activity and, ultimately, terminate his employment."

The complaint against Ring also recounts numerous alleged instances of hacked cameras allowing malicious actors to speak to victims, causing distress. Many of these attacks allegedly occurred through successful guessing of user passwords, reflecting failures by Amazon to require strong password protections, according to the complaint.

"Between January 2019 and March 2020, more than 55,000 U.S. customers suffered from credential stuffing and brute force attacks that compromised Ring devices," the FTC alleged. "Through these attacks, bad actors gained access to hundreds of thousands of videos of the personal spaces of consumers' homes, including their bedrooms and their children's bedrooms—recorded by devices that Ring sold by claiming that they would increase consumers' security."

As part of the proposed settlement, Ring has agreed to pay $5.8 million and implement a new data security program, according to the filing.

"Ring promptly addressed these issues on its own years ago, well before the FTC began its inquiry," Ring said in a statement provided to CNN. "While we disagree with the FTC's allegations and deny violating the law, this settlement resolves this matter so we can focus on innovating on behalf of our customers."

Separately, Amazon will pay $25 million to settle the allegations surrounding its Alexa voice assistant.

In a complaint, the FTC alleged that Amazon violated a children's privacy law known as COPPA, which restricts the collection of personal information from children under 13 without a parent's consent.

According to the FTC, Amazon kept Alexa voice recordings of children "indefinitely" unless a user specifically instructed the company to delete the recordings. It also allegedly sometimes failed to honor the deletion requests "and instead retained that data for its own potential use."

The proposed Alexa settlement requires Amazon to delete voice recordings and geolocation data in accordance with past consumer requests, including that of children. The company will also be barred from using that data to train its algorithms, the FTC said. Amazon also agreed to send consumers notices about the FTC settlement, and to implement a privacy program for geolocation data.

Amazon did not immediately respond to a request for comment on the Alexa settlement.

The Federal Trade Commission is taking action against companies it believes are bending the rules of the online review section.

In January, FTC leaders announced a $4.2 million settlement with online fast-fashion retailer Fashion Nova, resolving allegations that Fashion Nova only published four- and five-star reviews from late 2015 until November 2019.

"This is actually the FTC's first case challenging a company for the failure to post negative reviews," said Amber Lee, an attorney in the FTC's Division of Advertising Practices. "We alleged Fashion Nova's review section suggested it contained the reviews of all purchasers who submitted an online review, when in fact, for a period of four years, it withheld hundreds of thousands of negative reviews."

The FTC's complaint said Fashion Nova used a third-party service to post positive reviews to its website automatically.

According to the FTC, anything lower than three stars would be held for company approval, claiming Fashion Nova didn't post any held reviews for four years.

"It's hard to have a complete picture of how often this is happening," said Lee, "but that's one of the reasons we are bringing this case: To show the marketplace that we do take this seriously. We want consumers to be able to shop online, especially now that consumers are shopping online so frequently, and to be able to look at the business's website and see the full picture of what other consumers are saying about the product."

In a statement, Fashion Nova called the FTC's allegations "inaccurate and deceptive."

"[Fashion Nova] immediately and voluntarily addressed the website review issues when it became aware of them in 2019," according to the statement. "Fashion Nova is highly confident that it would have won in court and only agreed to settle the case to avoid the distraction and legal fees."

Under the terms of the settlement, Fashion Nova will be forced to post all customer reviews on its website, "with the exception of reviews that contain obscene, sexually explicit, racist or unlawful content."

According to the FTC, Fashion Nova is also banned from "making misrepresentations about any customer reviews or other endorsements."

A common problem for online consumers

"One thing this case illustrates," said Lee, "is how hard it is for a consumer to know whether they're getting the full picture by looking at a seller's website."

While no data indicates how many businesses delete negative reviews from their website, a recent World Economic Forum study found that about 4% of online reviews may be fake.

The FTC advises consumers "to take their time, and to look and compare reviews from a variety of sources," said Lee. "We suggest starting with sites that are well-known for having credible and impartial expert reviews."

Marketing experts say that can be easier said than done.

"A lot of people are going to be calling my firm and asking how they can get reviews removed or suppressed," said Cynthia Giles, the founder of Cut Throat Marketing, which has offices in Colorado and South Carolina. "They want to know how Fashion Nova did it. And I always recommend - don't do that, people. Just be honest."

Giles said, in her experience, it is "very, very easy" for companies to purchase positive reviews online. It creates a complex landscape for consumers to navigate.

"It's not very common in service industries anymore because Google has cracked down on it," Giles said. But in other large online marketplaces, "with the way their stores are managed and set up, it's very easy to buy reviews. You can literally go to some websites and say, 'I want to buy some reviews,' and you'll get people to bid on it. They will just sit there and keep leaving reviews."

The practice can cost consumers in the long run. In the evolving world of online commerce, the review section plays a vital role in helping consumers decide whether a product is worth the money.

54% of online shoppers read reviews for everything they purchase, according to one 2021 survey. 25% say reviews play the most significant role in their purchasing decision.

"If you absolutely have to buy online, I would go and ask your friends on your social media platforms, 'Have you ever purchased from this company before?'" Giles said. "It's very difficult right now to tell you where to go to find honest reviews regarding these social media-based, e-commerce fashion stores. It's very, very difficult to find honest reviews for them right now."

The larger problem

Aram Sinnreich, the chair of the communication studies department at American University, said review schemes play on people's natural psychology.

"We tend to operate according to what we call a preferential attachment," Sinnreich said. "If something is popular, it must mean that a lot of other people like it, and in turn, that must mean it's pretty good."

That assumption, according to Sinnreich, "has been completely falsified online through the kind of fraud we see with various websites, creating platforms that allow people to juice up their ratings for money."

The money often comes directly from consumer wallets.

According to estimates from the World Economic Forum, the online review industry influences $152 billion in spending each year.

"What we need is basically the equivalent of a declaration of human rights, saying that data should not be messed with and our decision-making processes should not be subverted by automated algorithms," said Sinnreich, describing the need for policy at the state and federal level.

"You can't have a democratic society, a just and equitable society unless you can be confident that data means what it means," Sinnreich said. "That it travels where it's supposed to travel and that you have a basic modicum of privacy in your dealings."

Protecting yourself

In the end, the burden is on us to make sure we aren't influenced by bad actors online.

"Take your time to look at a variety of sources for reviews," said Lee, who pointed out that fraud can be reported directly to the FTC online. "If you can, try to find websites that are well-known for giving credible or impartial expert reviews."

Some believe it can be best to avoid the online marketplace altogether.

"Buy your clothes local," said Giles. "Try to buy from a local store. That's probably the best advice I can give you."

Phone manufactures do their best to make it incredibly difficult for third-party repair companies to purchase parts and even access repair manuals, meaning the cost consumers pay to repair their cellphones goes up.

But all of that might change thanks to the right-to-repair movement that is gaining national attention.

Nathan Proctor is a right-to-repair advocate with U.S. PIRG. For years, he's been pushing for consumers to be able to do whatever they please when it comes to repairing electronic equipment like cell phones.

"The problem is, [phone companies] sold us a phone, we bought it, it’s ours now, and they don’t get to tell us what to do," he explained.

In early July, President Joe Biden signed an executive order asking the Federal Trade Commission (FTC) to tackle "unfair anti-competitive restrictions on third-party repair." And now, the FTC has voted to enforce the order.

But how will enforcement work?

The government agency is mainly relying on you, the consumer, to report issues online at FTC.gov.

The most common complaint is that a company tells a consumer they've voided a warranty by having one of those third-party companies repair a cellphone.

"We’ve been working to create a campaign where people understand no one should be able to tell me when and where I should be able to fix stuff," Proctor said.