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The United States Competition Commission (FTC) and prosecutors representing 48 states and territories across the country filed a lawsuit against Facebook on Wednesday alleging that the social media giant abused its dominant position with its large acquisitions to neutralize competition.
In particular, authorities blamed Facebook for the Acquisitions of Instagram in 2012 for 1 billion dollars and the messaging service WhatsApp in 2014 for $ 22 billion. They also criticized the conditions imposed by Facebook on software developers.
“Facebook’s actions to entrench and maintain its monopoly deny consumers the benefits of competition,” said Ian Conner, director of the FTC’s Office of Competition.
“Our goal is to reverse anti-competitive behavior Facebook and restore competition so that innovation and free competition can flourish, “he added.
What are the plaintiffs asking for? What did Facebook say?
The FTC is asking the courts to eventually force Facebook to resell Instagram and WhatsApp.
The agency also wants the group led by Mark Zuckerberg to stop forcing developers to accept certain conditions and ask him for the green light for any acquisition operation.
Prosecutors for their part claim be notified of any acquisition over $ 10 million that the social network would like to carry out.
“Using the vast resources at your disposal in terms of data and money, Facebook has crushed or hindered what the company saw as potential threats “New York State Attorney General Letitia James said at a news conference.
In doing so, the group “reduces consumer choice, stifles innovation, degrades the protection of the privacy of millions of Americans, “he added.
The world’s leading social network has consistently rejected the accusations of monopoly arguing that consumers have many options on how to interact online.
The lawsuit heralds a fierce court battle which seeks to force Facebook to get rid of the applications that have become an increasingly important element of the Californian giant’s business model and that are integrated into its technology.
Facebook said it will provide a detailed response after reviewing the case.But he cautioned, “Years after the FTC authorized our acquisitions, the government now wants a new review regardless of the impact the precedent would have on the broader business community or on the people who choose our products every day.”
Advantage for your access to data
The case is likely to depend not only on the proportion of Facebook social media users, but also on the large number of data it collects from some 3 billion users worldwide.
“Facebook has been dedicating its time to monitor users’ personal information and take advantage of it, ”warned James.
“No company should have so much power without control over our personal information and our social interactions,” he added.
Tiffany Li, a Boston University law professor who studies the sector, said that while Facebook has rivals competing for the attention of Internet users, it has a huge advantage because of its access to data.
“A company that owns multiple platforms is not, in and of itself, necessarily an obstacle to competition,” Li said on Twitter.
“However, a company that has sole ownership of large amounts of user data, with no potential for interoperability or access to competition, can be anti-competitive,” he explained.
Li added that startups “have an uphill battle to reach users due to network effects, even if they have better products. “
Review of shopping from internet giants
The FTC announced earlier this year that it would review acquisitions made by five big tech firms over the past decade, opening the door to a wave of potential antitrust investigations.
The consumer protection agency said that review deals made by Amazon, Apple, Facebook, Microsoft and Google parent Alphabet, since 2010, amid growing complaints about technology platforms that have dominated key economic sectors.
The Department of Justice and eleven states began a process against Google in mid-October, accusing the group of abusing a quasi-hegemony with its search engine.
Scrutiny has been mounting for large tech companies that have extended their dominance in recent years, including during the global pandemic, as more people turn to internet platforms for goods and services.
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