The latest major deal to collapse under pressure from antitrust enforcers did not fail due to high combined market shares in existing product markets. Applied Materials, Inc. abandoned its 18-month pursuit of Tokyo Electron Limited amid concerns by the Antitrust Division of the U.S. Department of Justice and foreign antitrust regulators regarding potential harm to future industry innovation. Companies contemplating a transaction should be mindful that antitrust authorities will take a close look at the deal's potential impact on innovation, particularly in industries where a small number of competitors with large R&D budgets are viewed as driving innovation. Implementing remedies to address regulators' concerns regarding the loss of competition to innovate may present practical challenges not involved in the divestiture of a business line for an existing product or service. In addition to assessing current product and service overlaps, parties contemplating a merger should carefully consider how antitrust authorities may view the transaction's likely effect on industry innovation.