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Double hit
The judicial strike on Facebook occurred in a double way with the entry of the Federal Trade Commission, which filed a parallel lawsuit, which caused the company’s share of almost four percent to plummet.
The FTC said in its lawsuit that it had since kicked out Facebook’s first competitor. "MySpy" To achieve monopoly power, Facebook resorted to its defense strategy through anti-competitive means.
He noted that after identifying two major competitive threats to its dominant position on social media, Instagram and WhatsApp, Facebook moved to suppress these threats by buying companies, reflecting the point of view of CEO Mark Zuckerberg.
In emails revealed by the House Antitrust Subcommittee during a hearing last summer, Zuckerberg described his intention to buy Instagram, in emails to David Ebersmann, Facebook’s chief financial officer at the time, as a way to neutralize a competitor while improving Facebook by integrating features. Invented by the app, before any other newbie had time to catch up and pose a similar threat.
This message was cited by the Federal Trade Commission in its lawsuit against Facebook and its founder who adopts a philosophy "The purchase is better than the competition"As stated in the lawsuit.
Facebook first revealed that it was under an antitrust investigation from the Federal Trade Commission in July last year, when a coalition led by Letitia James of New York announced a trade investigation shortly thereafter.
Facebook has faced accelerated scrutiny over its handling of user data and competitive practices since 2017, when news investigations revealed that its service had been used by political data company Cambridge Analytica to obtain information about users without their prior consent. of the 2016 US presidential elections.
The Federal Trade Commission agreed with Facebook to pay $ 5 billion last year, after investigating its data practices.
Tech hawks have criticized the deal in Congress as a minor warning to the company. The amount paid represents only about 9 percent of the Silicon Valley giant’s 2018 revenue.
Lawmakers at the time also criticized the Federal Trade Commission for failing to properly scrutinize Facebook’s acquisitions after the House Judiciary Committee issued internal Facebook documents on its moves toward competition.
The lawsuit, the culmination of a more than a year-long investigation, is the latest blow for major tech companies.
Just two months ago, the US Department of Justice and 11 states filed a lawsuit against Google, alleging that the company violated competition law.
The Justice Ministry, in its October dossier, made it clear that the search engine giant had violated antitrust law by illegally maintaining a monopoly on public internet searches by linking distribution channels to competition.
Former FTC attorney Charlotte Solomon said: "There has been a long time when law enforcement and regulators have said they prefer not to interfere with big tech companies, and it has become clear that time is over.".
The investigations could force Facebook to separate parts of its business or impose far-reaching restrictions on its operation.
But experts say that Facebook could also be forced to allow people to simultaneously post to non-Facebook platforms, and also allow them to view competing social media posts.
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The lawsuit is based on accusing Facebook of violating monopoly law and harming competition by buying smaller companies like Instagram and WhatsApp, to squash the threat they pose to the company’s business.
The lawsuit centers on the history of acquisitions initiated by Facebook, especially those it made in 2011, when it bought the Instagram app for a $ 1 billion deal, and the WhatsApp app in 2014 for $ 19 billion. .
For nearly a decade, said New York Attorney General Letitia James, Facebook has used its dominance and monopoly power to crush small competitors and eliminate competition, at the expense of ordinary users.
James and the rest of the forty-seven plaintiffs explained that the Facebook acquisitions were illegal.
The plaintiffs are asking the federal court to intervene regarding the possibility of separating these apps, and the lawsuit also asks the court to immediately prevent Facebook from making acquisitions worth more than $ 10 million with the end of the case.
Double hit
The judicial strike on Facebook occurred in a double way with the entry of the Federal Trade Commission, which filed a parallel lawsuit, which caused the company’s share of almost four percent to plummet.
In its lawsuit, the Federal Trade Commission said that since the overthrow of Facebook’s number one rival, MySpy, and the achievement of monopoly power, Facebook has switched to a defense strategy through anti-competitive means.
He noted that after identifying two major competitive threats to its dominant position on social media, Instagram and WhatsApp, Facebook moved to suppress these threats by buying companies, reflecting the point of view of CEO Mark Zuckerberg.
In emails revealed by the House Antitrust Subcommittee during a hearing last summer, Zuckerberg described his intention to buy Instagram, in emails to David Ebersmann, then Facebook’s chief financial officer, as a way to neutralize a competitor while enhance Facebook by integrating features. Invented by the app, before any other newbie had time to catch up and pose a similar threat.
This message was evidenced by the Federal Trade Commission in its lawsuit against Facebook and its founder, who embraces the philosophy of “buying is better than competing,” as stated in the lawsuit.
Facebook first revealed that it was under an antitrust investigation from the Federal Trade Commission in July last year, when a coalition led by Letitia James of New York announced a trade investigation shortly thereafter.
Facebook has faced accelerated scrutiny over its handling of user data and competition practices since 2017, when news investigations revealed that its service had been used by political data company Cambridge Analytica to obtain information about users without their prior consent. of the 2016 US presidential elections.
The Federal Trade Commission agreed with Facebook to pay $ 5 billion last year, after investigating its data practices.
Tech hawks have criticized the deal in Congress as a minor warning to the company. The amount paid represents only about 9 percent of the Silicon Valley giant’s 2018 revenue.
At the time, lawmakers also criticized the Federal Trade Commission for failing to properly scrutinize Facebook’s acquisitions after the House Judiciary Committee issued internal Facebook documents relating to its moves toward competition.
The lawsuit, the culmination of a more than a year-long investigation, is the latest blow for major tech companies.
Just two months ago, the US Department of Justice and 11 states filed a lawsuit against Google, alleging that the company violated competition law.
The Justice Ministry, in its October dossier, made it clear that the search engine giant had violated antitrust law by illegally maintaining a monopoly on public internet searches by linking distribution channels to competition.
“There has been a long time when law enforcement and regulators have said they prefer not to interfere with big tech companies, and it has become clear that time is over,” said Charlotte Solomon, former attorney for the Federal Commission. trade.
The investigations could force Facebook to separate parts of its business or impose far-reaching restrictions on its operation.
But experts say that Facebook could also be forced to allow people to simultaneously post on non-Facebook platforms, and also allow them to view competing social media posts.
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