US Government sues Facebook for illegal monopolisation

The American Federal Trade Commission (FTC) has sued Facebook, alleging that the company is illegally maintaining a social networking monopoly through a “years-long course of anticompetitive conduct.”

The action follows a lengthy investigation by the FTC in cooperation with a coalition of attorneys and alleges that Facebook has engaged in a systematic strategy, including its 2012 acquisition of Instagram, its 2014 acquisition of WhatsApp, and the imposition of anticompetitive conditions on software developers to eliminate threats to its monopoly.

The commission said that this ‘strategy’ harms competition, leaves consumers with few choices for personal social networking, and deprives advertisers of the benefits of competition.

The FTC is seeking a permanent injunction in federal court that could, among other things: require divestitures of assets, including Instagram and WhatsApp; prohibit Facebook from imposing anticompetitive conditions on software developers; and require Facebook to seek prior notice and approval for future mergers and acquisitions.

“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. Our aim is to roll back Facebook’s anticompetitive conduct and restore competition so that innovation and free competition can thrive.”

The FTC has described Facebook as the world’s “dominant personal social networking service” and said that this unmatched position has provided Facebook with “staggering profits.”
According to the commission, last year Facebook generated revenues of more than $70 billion and profits of more than $18.5 billion.

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