June 19, 2024


Simply Consistent

FTC Accuses Facebook of Social Media Monopoly, Calls for Divestiture of Instagram and WhatsApp

The United States Federal Trade Commission today teamed up 46 states, the District of Columbia, and the territory of Guam to sue Facebook for maintaining an illegal social networking monopoly by means of many years of anticompetitive perform.


Facebook is accused of engaging in a “systematic approach” to eradicate threats to its monopoly, which bundled the 2012 acquisition of Instagram and the 2014 acquisition of WhatsApp. Facebook’s steps have harmed competition, left consumers with several alternatives for particular social networking, and deprived advertisers of the gains of opposition.

The FTC is aiming for a everlasting injunction that would demand the divestitures of assets that involve Instagram and WhatsApp, which would suggest Facebook would be pressured to offer the two social networks. Facebook would also be prohibited from imposing anticompetitive problems on application developers and it would require governing administration approval for long term mergers and acquisitions.

“Particular social networking is central to the life of hundreds of thousands of Us residents,” reported Ian Conner, Director of the FTC’s Bureau of Competitors. “Facebook’s actions to entrench and keep its monopoly deny shoppers the added benefits of levels of competition. Our purpose is to roll back again Facebook’s anticompetitive carry out and restore levels of competition so that innovation and cost-free competitors can thrive.”

The criticism says that while Facebook at first attempted to contend with Instagram, it ultimately selected to buy Instagram in its place, neutralizing the risk and generating it tricky for another social networking competitor to acquire scale. Facebook’s management also allegedly understood and feared that a prosperous cell messaging app like WhatsApp could enter the social networking market place, which is why it pursued the WhatsApp acquisition.

In accordance to the FTC, Facebook’s dominance in social networking has offered it with “staggering earnings,” together with revenue of additional than $70 billion and gains of more than $18.5 billion in 2019. Facebook has been under investigation for much more than a year, with that investigation culminating in the lawsuits filed right now.

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