It’s Complicated: Facebook Faces Federal Anti-Trust Lawsuit Times Two

Facebook faces a pair of bi-partisan suits filed by the Federal Trade Commission and 48 other state Attorneys General; Georgia is not among them – for now. These claim that Facebook bought Instagram and What’s App to quash competition against their popular social media platform that now totals over three billion users.

The lawsuits come after the purchases were approved by the same FTC on separate occasions just a handful of years ago. In that time, Facebook has taken deliberate steps to integrate the technology behind these three social media platforms as closely as possible to make a relationship change as complicated as possible. Facebook is now the second “big tech” company in as many months to face federal anti-trust charges for the first time since Microsoft in the late 1990s.

William Kovacic, former FTC chairman, explained the change of heart by referencing that there is “nothing in U.S. merger law that says an agency’s decision not to challenge a proposed deal immunizes that deal from future review”.

Facebook VP and General Counsel Jennifer Newstead offered Facebook’s stance by stating that “the government now wants a do-over, sending a chilling warning to American business that no sale is ever final”.

  As these suits progress, it is highly likely that two more of the so called “FAANG” companies in Amazon and Apple also get pulled into the dispute. Those four companies account for such a massive amount of personal info, web interaction, and basics such as groceries and medicine daily for billions of people across the globe.  It is not a stretch to say that these ‘FAANG’ companies (Netflix being the ‘N’) touch almost all four corners of our daily life in some way.

Even before the pandemic changed interaction norms, much of the world was moving toward an increase in digitization such as Instagram, streaming services like Spotify, and video content via Snapchat and TikTok. Information and analytics have quickly become the product many of these services monetize through their “free” services, and especially so of the subscription-based offerings. As this digitization trend continues, it will be worth the time to watch how these tech companies respond to federal level pressure and what corporate and industry-wide changes happen – hopefully to the benefit of us as a willing (or unwilling) consumer.