The Federal Trade Commission of the United States (FTC, for its acronym in English) and a group of prosecutors from 48 of the 50 states of the country have filed a lawsuit against Facebook on Wednesday to reduce the size of the company and its market position .
According to the lawsuit, the technology company led by Mark Zuckerberg has been maintaining its “monopoly” in the social media sector for years through business conduct that undermines the free exercise of competition. The reaction of the technology company was immediate, and in a statement it lamented the “adverse effects” that said restrictions will have on the business community and users of its services.
The penultimate chapter of the antitrust offensive against the Palo Alto giant has generated uneasiness on the trading floor, with the Nasdaq technology index down nearly 2%. The other indices have registered slight decreases, due to the continued blockage around the new stimulus package.
The lawsuit, filed in federal court in Washington, was announced by New York State Attorney General Letitia James, who is leading the action. The States accuse Facebook of illegally acquiring competitors such as Instagram or WhatsApp, thus depriving consumers of the benefits and advantages of a competitive market and with greater guarantees of privacy protection; It should be remembered that the company received a fine of 5,000 million dollars in 2019 for the data leak of the ‘Cambridge Analytica case’.
Facebook bought Instagram in 2012 for a billion dollars and the messaging system WhatsApp two years later for 1.9 billion. Since they were acquired by Facebook, the two social networks have seen their popularity skyrocket, helping to shore up the monopoly of technology, a company that started in a student dormitory on campus and whose value is now estimated at more than 800,000 million.
Federal and state regulators have investigated Zuckerberg’s company for 18 months. “This conduct hurts competition, leaves consumers with little choice in their personal social networks, and deprives advertisers of the benefits of competition,” the FTC said in a statement. The plaintiffs are asking the court to force Facebook to divest assets or implement restructuring of its business, especially in relation to the photographic social network and the popular messaging service.
“Social media is central to the lives of millions of Americans. Facebook’s practice of entrenching itself and maintaining its monopoly denies consumers the benefit of competition, “the plaintiffs claim, in conduct that they clearly consider” anti-competitive. “
The lawsuit illustrates the growing domestic and international offensive against the tech giant. Legislators and regulators have long targeted Facebook, Google, Amazon, and Apple for their dominance in commerce, electronics, social media, search engines, and online advertising, something that stops Many supposes an economic injection in times of crisis due to the pandemic but that, in the consideration of others, such as President Donald Trump and his rival, President-elect Joe Biden, represents a risk because of the power and influence they accumulate. Both the Democratic and Republican parties have been in favor of regulating the activity of big technology, which has been substantiated in recent months in a lawsuit by the Department of Justice against Google for abusing its position in the face of competition. Another in the same direction is expected, at the behest of Republican and Democratic legislators, by the end of the year. Regulators in Europe also uphold stricter laws to limit the dominance of the tech industry, and have imposed billions of dollars in fines for violating competition laws.
The battles against Facebook are expected to trigger an arduous and protracted legal battle, before which the technology appears armored by its immeasurable market value and a more than likely luxury defense. The company has repeatedly refused to violate any antitrust rules. Very few major antitrust cases have pointed to mergers approved and closed years earlier; in fact, the Federal Trade Commission approved the agreements to acquire Instagram and WhatsApp by Facebook during the term of Barack Obama.