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Facebook Has Held “Durable Monopoly” For Ten Years: FTC

The Federal Trade Commission yesterday filed an amended antitrust suit against Facebook, claiming they have had a social media monopoly since 2011.

The FTC’s original suit was dismissed in June after a federal judge found the complaint “vague”, prompting a stronger-worded filing that alleges the company engages in “buy or bury” practices to remove competition, has maintained an illegal and “durable monopoly” for a decade, and should be forced to sell off assets including WhatsApp and Instagram.

“Facebook holds monopoly power in the provision of personal social networking in the United States and has held such power continuously since at least 2011,” the FTC wrote.

“Unable to maintain its monopoly or its advertising profits by fairly competing, Facebook’s executives addressed this existential threat by buying up the new mobile innovators, including its rival Instagram in 2012 and mobile messaging app WhatsApp in 2014, who had succeeded where Facebook had failed.”

The new suit is 80-pages long and defines some of the earlier complaints deemed too vague or speculative. In particular, it argues that TikTok’s rapid rise doesn’t diminish Facebook’s monopoly, as it is not used as a tool to communicate with friends or family.

“Snapchat is the next-largest provider of personal social networking services, but its user base pales in comparison: Snapchat has tens of millions fewer monthly users than either Facebook Blue or Instagram,” the FTC said.

Facebook has until October 4 to respond in court, but has called the suit “an effort to rewrite antitrust laws”

“Our acquisitions of Instagram and WhatsApp were reviewed and cleared many years ago, and our platform policies were lawful,” a Facebook spokesperson said.

“The FTC’s claims are an effort to rewrite antitrust laws and upend settled expectations of merger review, declaring to the business community that no sale is ever final.”

 

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