The FTC’s Antitrust Lawsuit Against Meta Has Been Given The Green Light
As we previously reported, in December of 2020, the Federal Trade Commission and 48 state attorneys general filed two separate antitrust lawsuits against Facebook, now known as Meta. These parties claimed that the social network hurt competition in the digital space by purchasing companies like Instagram and WhatsApp.
Not long after, in a stunning setback, a federal judge threw out these lawsuits. The judge ripped apart one of the federal government’s main arguments – that Meta holds a monopoly over social networking – stating that prosecutors had failed to supply enough evidence to back up that claim. Additionally, the judge said that the states waited too long to take their case to court, as the deals referenced happened back in 2012 and 2014.
Now, in January 2022, Meta is facing another antitrust challenge, with the FTC’s case against the Company approved for the next stage. Here’s what you need to know.
According to The Washington Post:
The revised complaint included enough facts to “plausibly establish” that Facebook has a monopoly in personal social networking, referring to services that allow people to maintain relationships with family and friends online, Boasberg said. Boasberg said the “Achilles’ heel” of the FTC’s first complaint was that it was devoid of data supporting its claim that “no other social network of comparable scale exists in the United States.” But the revised complaint included data from the analytics firm ComScore, and argued that Facebook’s share of daily active users of apps providing personal social networking in the United States has exceeded 70 percent since 2016.
This time around, the FTC included Comscore data that shows that Meta’s daily share of active users had exceeded 70% of all personal social networking apps since 2016.
Despite the ruling, Meta said it was ultimately a good thing for them. Chris Sgro, a policy spokesperson for Meta, said:
“We’re confident the evidence will reveal the fundamental weakness of the claims. Our investments in Instagram and WhatsApp transformed them into what they are today. They have been good for competition and good for the people and businesses that choose to use our products.”
Now, Lina Khan, head of the FTC, has a big fight ahead of her, and these court battles will likely go on for years. According to Fortune, Since the Reagan administration, antitrust cases have been decided by one guiding principle: Is the company engaging in predatory pricing? Using that narrow definition rules out both Instagram and WhatsApp, which are free for users.
At this moment, it seems likely that Meta’s empire will remain unchanged at the end of the proceedings. Though, the fact that the Federal Court has approved the case points to further scrutiny of similar tech acquisitions in the future.
We will continue to keep you updated on this situation as it develops!
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