US federal and state antitrust enforcers on Wednesday filed suits against Facebook Inc claiming the social media giant abused its dominant position and seeking to unwind its acquisitions of messaging services Instagram and WhatsApp.
Separate suits filed by the US Federal Trade Commission (FTC) and a coalition of state officials called for the divestment of Instagram and WhatsApp, services that are part of the Facebook “family” of applications.
“Facebook’s actions to entrench and maintain its monopoly deny consumers the benefits of competition,” said Ian Conner, director of the FTC’s Bureau of Competition. “Our aim is to roll back Facebook’s anticompetitive conduct and restore competition so that innovation and free competition can thrive.”
Photo: Reuters
A separate legal action was filed by antitrust enforcers from 48 US states and territories.
“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,” said New York Attorney General Letitia James, who leads the coalition.
The suits allege Facebook sought to squelch competition by acquiring the messaging applications — Instagram in 2012 and WhatsApp in 2014.
The action presages a fierce court battle seeking to force Facebook to divest the apps that have become an increasingly important element of the business model of the California giant and integrated into its technology.
Facebook said it would “vigorously” defend its actions and denied abusing its position.
“Antitrust laws exist to protect consumers and promote innovation, not to punish successful businesses,” Facebook general counsel Jennifer Newstead said in a statement.
“Instagram and WhatsApp became the incredible products they are today because Facebook invested billions of dollars, and years of innovation and expertise, to develop new features and better experiences for the millions who enjoy those products,” she said.
Newstead said these deals had been approved years ago by the FTC, which she said meant “the government now wants a do-over, sending a chilling warning to American business that no sale is ever final.”
Some analysts said the antitrust cases would have difficulty proving Facebook harmed consumers since its services are largely free.
Jessica Melugin of the Competitive Enterprise Institute libertarian think tank called the actions “political theater dressed up as antitrust law,” adding that “a billion consumers worldwide have benefited from Facebook’s purchase of Instagram and WhatsApp.”
Cleveland State University law professor Christopher Sagers said the case might have merit because Facebook “has been an unabashedly predatory and exclusionary bully in every sector it’s been involved in.”
However, he added that “American antitrust law is now so hard to enforce in all cases, especially in cases like this, involving no conspiracy among competitors, and rather involving only one big firm’s unilateral conduct.”
The FTC announced earlier this year it would review acquisitions made by five “Big Tech” firms over the past decade, opening the door to a wave of potential antitrust investigations.
The consumer protection agency said it would review deals made by Amazon.com Inc, Apple Inc, Facebook, Microsoft Corp and Google parent Alphabet Inc since 2010 amid growing complaints about tech platforms that have dominated key economic sectors.
The US Department of Justice, which shares antitrust enforcement with the FTC, in October sued Alphabet, accusing the Silicon Valley giant of maintaining an “illegal monopoly” in online search and advertising, and opening the door to a potential breakup.
Eleven US states joined that case.
The EU and US are nearing an agreement to coordinate on producing and securing critical minerals, part of a push to break reliance on Chinese supplies. The potential deal would create incentives, such as minimum prices, that could advantage non-Chinese suppliers, according to a draft of an “action plan” seen by Bloomberg. The EU and US would also cooperate on standards, investments and joint projects, as well as coordinate on any supply disruptions by countries like China. The two sides are additionally seeking other “like-minded partners” to join a multicountry accord to help create these new critical mineral supply chains, which feed into
For weeks now, the global tech industry has been waiting for a major artificial intelligence (AI) launch from DeepSeek (深度求索), seen as a benchmark for China’s progress in the fast-moving field. More than a year has passed since the start-up put Chinese AI on the map in early last year with a low-cost chatbot that performed at a similar level to US rivals. However, despite reports and rumors about its imminent release, DeepSeek’s next-generation “V4” model is nowhere in sight. Speculation is also swirling over the geopolitical implications of which computer chips were chosen to train and power the new
Elon Musk’s lieutenants have reached out to chip industry suppliers, including Applied Materials Inc, Tokyo Electron Ltd and Lam Research Corp, for his envisioned Terafab, early steps in an audacious and likely arduous attempt to break into the production of cutting-edge chips. Staff working for the joint venture between Tesla Inc and Space Exploration Technologies Corp (SpaceX) have sought price quotes and delivery times for an array of chipmaking gear, people familiar with the matter said. In past weeks, they’ve contacted makers of photomasks, substrates, etchers, depositors, cleaning devices, testers and other tools, according to the people, who asked not to
Japan approved ￥631.5 billion (US$3.97 billion) in additional subsidies to hasten Rapidus Corp’s entry into the high-stakes artificial intelligence (AI) chipmaking arena, ramping up support for a project widely regarded as a long shot. The capital is intended to bankroll Rapidus’ work for information technology firm Fujitsu Ltd, one of the initial customers that Tokyo hopes would get the signature endeavor off the ground. The new money raises the fees and investments that the government is injecting into the start-up to ￥2.6 trillion by the end of the current fiscal year to March next year, the Japanese Ministry of Economy, Trade and
RSS