Mark Zuckerberg, co-founder, chairman and CEO of Facebook, and Washington D.C. Testified before the House Energy and Commerce Mercer Committee on April 11, 2018 at the Riburn House Office Fees Building on Capitol Hill.
Yasin Ozturk | Anadolu Agency | Getty Images
Before federal and state investigators filed a fairly distrustful lawsuit against Facebook in federal court this month, the company’s top lawyers extended the olive branch for the report to show that it could stimulate competition.
Facebook’s lawyers told investigators it could help a new social network enter the field by licensing its own code and a web of users’ relationships to another company.
The researcher eventually refused to take Facebook on the suggestion, the post said, but the offer explains what Facebook was willing to give and what it was not willing to give out of the lawsuit. Allegations of anti-Facebook behavior have been denied.
Part of the lawsuit focuses on the concept of network effects, which describes how a network can, in terms of industry, become more and more “sticky” for users. For example, once most of a user’s friends and family have joined the same social network, the user has less incentive to switch to a new platform with fewer users, even if it has some more desirable features.
Facebook’s reported offer fur does not fully account for this effect. Based on the lawsuits, regulators believe that Facebook’s enduring power is not just based on its technology, but is already embedded in the lives of many people.
Facebook did not comment to CNBC, but a spokeswoman told the Post in a statement:
An FTC spokeswoman declined to comment, and a representative of New York Attorney General Letia James, who is leading the states’ efforts against Facebook, did not immediately respond.
Read the full story on the Washington Post.
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