US regulators ask for Facebook to divest Instagram and WhatsApp after concerns it abused monopoly
United States trade regulators have asked for Facebook to be forced to sell its Instagram and WhatsApp messaging services, accusing the company of abusing its market power in social networking to crush smaller competitors.
In a lawsuit, the Federal Trade Commission (FTC) is seeking the situs slot online separation of the services from Facebook, saying Facebook has engaged in “a systematic strategy” to eliminate its competition, including by purchasing smaller up-and-coming rivals like Instagram in 2012 and WhatsApp in 2014.
The lawsuit — which includes 46 states, Guam and the District of Columbia — accuses Facebook of anti-competitive conduct and using its market dominance to harvest consumer data and reap a fortune in advertising revenues.
The antitrust lawsuits were announced by the Federal Trade Commission and New York Attorney-General Letitia James.
Ms James said in a press conference that Facebook “used its monopoly power to crush smaller rivals and snuff out competition, all at the expense of everyday users”.
“It’s really critically important that we block this predatory acquisition of companies and that we restore confidence to the market,” Ms James said.
Ms James alleged Facebook had a practice of opening its site to third-party app developers, then abruptly cutting off developers that it saw as a threat.
The coalition of governments are confident they will succeed, Ms James said, pointing to previous break-up actions, such as the 1980s action against telecommunications company AT&T, as possible precedent.
“Personal social networking is central to the lives of millions of Americans,” Ian Conner, director of the FTC’s Bureau of Competition, said in a statement.
“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.”