Facebook Facing Illegal Monopolization Lawsuit

Facebook is facing a lawsuit filed by the Federal Trade Commission (FTC) that argues the social media giant is "illegally maintaining its personal social networking monopoly through a years-long course of anticompetitive conduct." That’s what the FTC reported in a release published on Wednesday (December 9th), announcing the suit. The suit—which came to fruition following an investigation that saw the collaboration of 46 states, Washington DC, Guam, and a "coalition of attorneys"—further alleges that Facebook has engaged in a strategy to eliminate threats to its monopoly, citing the company’s 2012 acquisition of Instagram, its 2014 acquisition of WhatsApp and anticompetitive conditions imposed on software developers. The FTC expanded on Facebook’s acquisitions, specifically Instagram, alleging the company initially tried to compete with Instagram, but ultimately chose to purchase the company rather than compete with it for the sum of $1 billion. The complaint further states almost the same story for WhatsApp; the company chose to acquire the messaging service for $19 billion in 2014, instead of competing. On the subject of developers, the complaint alleges that Facebook enforced policies that imposed anticompetitive conditions on third-party software developers’ access to valuable interconnections to its platform, such as Facebook’s application programming interfaces or API—which allows apps to interface with the social media service. According to the FTC, Facebook allegedly made APIs available to third party developers on the condition that they do not develop "competing functionalities," along with barring developers from promoting or connecting with other social networking services. The FTC later provided the late-social networking service Vine as an example of Facebook’s anticompetitive behavior. Back in 2013, when Twitter launched Vine, Facebook supposedly shut down the API that would have allowed Vine to access friends via Facebook’s platform. “Personal social networking is central to the lives of millions of Americans,” said Ian Conner, Director of the FTC’s Bureau of Competition. “Facebook’s actions to entrench and maintain its monopoly deny consumers the benefits of competition."  Per their release, the FTC aims to seek a permanent injunction in federal court that could see the divestitures of the giant’s assets, including Instagram and WhatsApp. The injunction could also prohibit Facebook from imposing anticompetitive conditions on software developers and require the company to seek approval for future mergers and acquisitions. The commission voted 3-2 to authorize staff to file for a permanent injunction and other relief in the U.S. District Court for the District of Columbia. Florida is among the 46 states that have joined the lawsuit against Facebook.