FTC Facebook antitrust investigation will focus on its acquisitions: Report
Some details about the Federal Trade Commission (FTC) antitrust investigation on social media giant Facebook has surfaced online. These details come about three weeks after the regulatory agency slapped a meager $5 billion fine on Facebook. According to a report, the agency is focusing its investigation on the recent Facebook acquisitions. FTC wants to know if these acquisitions were part of a strategy to halt competition in the market. This information comes about a week after Facebook informed the tech world about the latest antitrust investigation. However, Facebook did not share more information regarding the investigation while coming forward to the world.
FTC Facebook antitrust investigation details
According to a report by The Wall Street Journal, FTC will focus on Facebook acquisitions including Instagram and WhatsApp. The report revealed that FTC has contacted the founders of companies including WhatsApp and Instagram. Facebook and FTC have not issued a statement in response to this report. It is interesting to note that Facebook is not the only company currently at the center of an antitrust investigation. FTC has also launched other antitrust investigations in other tech giants including Google, Apple, and Amazon. According to a report by S&P Global, Facebook has purchased about 90 companies in the last 16 years.
A report by Reuters noted that Facebook has focused on such acquisitions for its growth in recent years. The company has shifted to this strategy because the number of users signing up to Facebook has decreased in the last couple of years. Focusing on other popular apps by acquiring them and then integrating them with Facebook makes it easier to gain new users. The report also noted that about 2.7 billion users use one of the apps from the Facebook family of apps every month.
Recent earnings call also revealed that Instagram is one of the main sources of revenue for Facebook. The report also noted that the investigation possibly focuses on section two of the Sherman Act. According to this section, it is illegal for a company to gain a monopoly with the help of improper means. It also noted that it will be difficult for FTC to prove that these acquisitions are illegal in nature.