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December 4, 2020

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New Antitrust Suit Set to Brought Against Facebook Over Instagram and WhatsApp Acquisitions

3 min read

Facebook is set to have another legal challenge on its hands, with The Washington Post reporting that a group of state attorneys general is on track to file antitrust charges against The Social Network over its acquisitions of Instagram and WhatsApp.

According to reports, the legal challenge will allege that Facebook’s purchases of rival social apps “helped create an anti-competitive social networking juggernaut”, which has since moved to quash opposition through its scale and data-gathering processes.

This isn’t the first time such concerns have been raised. Back in July, Facebook CEO Mark Zuckerberg faced a House Judiciary Committee hearing which sought to establish whether the tech giants, including Apple, Google and Amazon, along with Facebook, have been operating in an anti-competitive manner.

Zuckerberg was specifically questioned about Facebook’s acquisition of Instagram, which, documents suggest, was at least partly intended to ‘neutralize’ a competitor

At the conclusion of that hearing, it seemed clear that further steps would be taken – as summarized by House Judiciary Antitrust, Commercial and Administrative Law Subcommittee Chair David Cicilline:

“This hearing has made one fact clear to me: these companies as they exist today have monopoly power. Some need to be broken up, all need to be properly regulated and held accountable. We need to ensure the antitrust laws first written more than a century ago work in the digital age.”

This new push will look to add further weight to that call, which could lead to increased regulation, and potentially, a break-up of Facebook’s empire – though whether that would even be possible is another question entirely.

Some have suggested that a big part of Facebook’s push to integrate its messaging apps into a single back-end platform has been motivated by self-defense – i.e. by combining all the functionality of its various apps into one single framework, Facebook could justifiably argue that it can’t be broken up, because its apps are all part of a single, larger infrastructure framework. WhatsApp won’t work if you separate it from the chain, same with Instagram Direct.

That seems somewhat tenuous, given all three of its messaging apps were once their own, individual systems – but maybe, a year and a half on from its initial integration announcement, Facebook could now argue that irreversible work has been done to bolt its tools together in the back-end.

Either way, you can expect there to be increased calls for action, and you can expect Facebook to feel the heat, once again, over its market dominance. Whether that results in real action being taken is difficult to predict – there’s a reason why Facebook is hiring more and more lobbyists in Washington.

Indeed, Facebook reportedly spent around $16.7 million on political lobbying in 2019, up from $12.6 million in 2018, and it’s on track to beat that once again this year (Facebook spent $4.8 million on lobbying in the second quarter of 2020).

Will that hold off further action, or will we see a big push for change at The Social Network in 2020? 

One thing that is worth noting – former President Barack Obama recently noted that he thinks more action needs to be taken to limit the spread of misinformation on social networks, which he flagged as “the single biggest threat to our democracy”.

With Obama’s former VP set to take over as President, that could well be indicative of a larger push against Facebook coming in the near future.




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