Did Facebook quash potential competitors?
That is the question on the FTC’s mind, according to a story in today’sWall Street Journal, as they begin their preliminary investigation into whether the company’s many acquaints during the period 2008 to present stifle competition and as a result injured consumers.
The answer to the question the FTC poses is, of course Facebook either bought or crushed and made potential competitors , making them stillborn in their start up incubators. Why this is a question that is perplexing to the FTC is mystifying. The fact that they need to deliberate at length over this issue, demonstrates they clearly don’t understand Facebook’s business model or business practices.
The Journal notes,
“The tech giant has acquired about 90 companies over roughly the last 15 years, according to data compiled by S&P Global. Among those companies are the photo-sharing app Instagram and the messaging service WhatsApp, which bolstered Facebook as a dominant force in social media and messaging.”
Curiously, Facebook declined to comment concerning the investigation.
The ignorance of regulators could be forgiven if they exhibited a willingness to do penance for their decade-long somnolence and gross negligence in giving Facebook a laissez-faire, carte blanche to conduct their operations in a manner that they saw fit.
The FTC, as well as other regulatory agencies were asleep at the helm, while the company eliminated start up enterprises that it viewed as a threat to its social media market dominance. In short, regulators gave Facebook a get out of jail free card, while legislators marveled and paid extraordinary deference to the wised of the world’s largest advertising platform masquerading as a tech company.
The FTC has a chance to redeem itself for its inexcusable dereliction of duty, and stop equivocating over whether Facebook used anticompetitive practices.
Memo to FTC: yes Facebook did.
The other aspect of the investigation that is going to be a waste of time is resolving the question of whether Facebook’s unfair business practices “harmed” consumers. The Journal reports the prevailing view of lawyers at the FTC in connection with the necessary burden