Saturday, July 3, 2021

Facebook Under Fire as US Lawmakers Press for New Antitrust Complaint

A bipartisan group of US lawmakers expert in antitrust urged the Federal Trade Commission to press on with its lawsuit against Facebook, according to a statement from Senator Amy Klobuchar. Last week, the FTC said in a legal filing that it would seek to block a $5bn merger between Facebook and WhatsApp on the grounds that the deal would give the world’s largest social network too much control over online communication. Facebook denied that the deal could pose a threat to competition, but last week the FTC’s general counsel, Joe Simons, said the deal would almost certainly reduce choice for consumers and hurt competition. “Our antitrust team has worked exhaustively to assess the competitive impact of this proposed merger and believes it will reduce competition and consumer choice in the market for online communications and online services,” he said in the statement. Klobuchar said she was glad to see the FTC pursuing the case. “The FTC has been diligent and aggressive in taking action against anticompetitive practices in the past,” she said. “As the only consumer protection agency with antitrust enforcement authority, they are the appropriate agency to investigate the effects of this merger on consumers and competition.” Facebook said that it was not surprised by the move and reiterated that it “does not believe the proposed transaction will harm competition.” The proposed merger between Facebook and WhatsApp comes at a time when it is being sued by two European regulators for giving access to the data of its users. It is facing a similar case in Australia. The FTC did not comment on those countries’ action. On Monday night, the two companies said that “We understand the FTC’s concerns regarding our proposed acquisition of WhatsApp, and we will be working closely with the Commission as they review our application.” The deal comes at a time when many people, including Mark Zuckerberg, Facebook’s co-founder and CEO, and Sheryl Sandberg, its COO, have voiced support for net neutrality, the idea that all people should be able to access the web the same way. But Facebook’s position on net neutrality has shifted in the past year. Facebook last year blocked Instagram’s plan to implement a paid version of its app, and it also changed its policies that govern how app developers can run their own services through Facebook. The FTC’s action is a victory for consumer protection, says the group Free Press, a nonprofit advocacy organization, which has long called on the agency to stop the merger. “It’s good to see that the FTC is getting serious about defending consumer rights,” said Collin Reiff, director of government affairs for Free Press. “I’ve said before that we are facing a crisis of concentration in the media industry and that the FTC must step up to prevent further consolidation.” Facebook has made a practice of acquiring apps and using them to build features that compete against its rivals. The company bought the messaging app Snapchat for $16 billion in May. WhatsApp is owned by Facebook’s archrival, Alphabet, the owner of Google. 

 

 

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