Facebook Sued by FTC, States Over Alleged Abuse of Monopoly Power
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Facebook sued by FTC, states over alleged abuse of monopoly power:
The Federal Trade Commission and a coalition of more than 40 states and territories sued Facebook on Wednesday, alleging the social media giant had illegally stifled competition by snapping up rivals to protect its monopoly power in social networking.
The joint actions focus on Facebook's key acquisitions of Instagram, a photo-sharing service, and WhatsApp, an encrypted messaging app. The deals sealed Facebook's dominance in social networking, the lawsuits contend.
[...] "For nearly a decade, Facebook has used its dominance and monopoly power to crush smaller rivals and snuff out competition, all at the expense of everyday users," New York Attorney General Letitia James said in a statement. "Today, we are taking action to stand up for the millions of consumers and many small businesses that have been harmed by Facebook's illegal behavior.
Facebook's alleged monopoly has harmed consumers, resulting in fewer choices for social networking because it isn't easy for users to migrate their data to other platforms. The social media giant, which makes money from ads, has also come under fire for not doing enough to protect the privacy of its 2.7 billion monthly users.
The FTC complaint, filed in a federal court, calls for Facebook to divest Instagram and WhatsApp. It also seeks to have future Facebook acquisitions subject to approval before they are completed.
Facebook didn't immediately comment on the lawsuits.
The state lawsuit, filed by 46 state attorneys general and Guam and the District of Columbia[*], comes as lawmakers and regulators scrutinize the the power tech giants wield. In addition to Wednesday's actions, the DOJ's antitrust division has been talking to developers about their interactions with Oculus, the virtual reality headset maker Facebook owns, Bloomberg reported last week.
[...] Facebook has said the company's investment in Instagram and WhatsApp helped fuel the growth of both. The social network has noted that regulators reviewed the deals around the time of the transactions and didn't find a reason to stop them from moving forward.
Facebook has also said social media is a competitive space, citing rivals such as short-form video app TikTok, short-messaging site Twitter and Google-owned video platform YouTube.
Here's a link to the lawsuit filed by the FTC (PDF).
The lawsuit brought by the states (PDF) has participants from 46 states, Washington DC, and one territory (Guam):
Plaintiff States are Alaska, Arizona, Arkansas, California, Colorado, Connecticut, Delaware,District of Columbia, Florida, the territory of Guam, Hawaii, Idaho, Illinois, Iowa, Indiana,Kansas, Kentucky, Louisiana, Maine, Maryland, Massachusetts, Michigan, Minnesota,Mississippi, Missouri, Montana, Nebraska, Nevada, New Hampshire, New Jersey, New Mexico,New York, North Carolina, North Dakota, Ohio, Oklahoma, Oregon, Pennsylvania, RhodeIsland, Tennessee, Texas, Utah, Vermont, Virginia, Washington, West Virginia, Wisconsin, andWyoming.Not participating in the state lawsuit are: Alabama, Georgia, South Carolina, South Dakota.
Also at Ars Technica.
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