The US Federal Trade Commission or FTC is all set to take action against Facebook over antitrust issues to bar the giant from integrating its apps Instagram, FB Messenger, and WhatsApp into a single app.
FTC is considering to ask a court to stop Facebook from continuing with the integration of its WhatsApp, Instagram, and Messenger subsidiaries as early as January, the Wall Street Journal reported on Thursday, citing people familiar with the matter.
Facebook Integration Plan
As per the Facebook integration plan, the company wants to allow users to communicate with each other with end-to-end encryption which will be extended across all three platforms (WhatsApp, Messenger, and Instagram).
Facebook itself is a giant in the market with active users in billion and on top of that, it acquired WhatsApp and Instagram which made it the only company who offers services from advertising to media sharing platforms to instant messaging.
The Facebook business pattern is to acquire anything and everything which is trendy in the market so that ultimately all of it come under a single brand, FACEBOOK. Be it WhatsApp or Instagram, and the stats show that currently, WhatsApp is a more profitable property that Facebook owns. The company tried to buy Musical.ly (now called TikTok) and Snapchat but somehow things didn’t work out.
It’s all over the news that FTC is all set to take action against Facebook to halt the integration of its various own apps. This move might be the first step to force the company (Facebook Inc) to sell its profitable apps i.e. WhatsApp and Instagram. The reaction can be witnessed in the market as Facebook shares closed 2.7% lower on Thursday.
How Deep Is FTC Involved In All This?
Since the whole scenario has the “Use of Technology” case, FTC would seek an injunction on the basis of “interoperability” rules. This tells how digital platforms interact with one another based on concerns that Facebook’s policies limit other services’ ability to compete. Some officials were concerned about further integration of Facebook’s apps could make it harder to unwind later on.
Ultimately FTC will need to decide if they want to go for settlement with Facebook, drop the case, or bring an antitrust case to court. There are possibilities that the agency might try and block a few of the company’s interoperability policies that have previously disadvantaged social-media rivals in the past.
Facebook, Alphabet Inc’s Google, Amazon.com Inc, and Apple Inc all face antitrust investigations by the Justice Department and House of Representatives Judiciary Committee. And if you keep antitrust concerns aside, these tech giants are already facing criticism over privacy lapses. How they handle vast quantities of consumer data and accusations of bias in the polarized U.S. political environment.
Ultimately FTC will need to come to a conclusion the way they did in 2000 with Microsoft.
Democratic Rep. Ro Khanna, who represents Silicon Valley, wrote on Twitter – “This is why there should have been far more scrutiny during Facebook’s acquisitions of Instagram and WhatsApp which now clearly seem like horizontal mergers that should have triggered antitrust scrutiny,”
Seth Bloom, of Bloom Strategic Counsel, (involved in antitrust cases since the late 1990s, when the Department of Justice broke up Microsoft) – They have to file a lawsuit,”. “They can’t just do it unilaterally. It’s not something that would happen instantaneously.” Regulators have to prove that Facebook’s integration has given it unfair competitive advantages. “I think it would be a difficult case of them to make to show that further integrations will harm competition,”
What Do You Think?
What do you think about this whole drama happening around while we are endlessly using these apps? You are most welcome to share your opinions below.