The Federal Trade Commission’s antitrust investigation into Facebook will focus in on the tech giant’s acquisition of Instagram and WhatsApp.
The FTC wants to know if Facebook tried to acquire its social media rivals before they would become a threat to its business, the Wall Street Journal reported on Thursday.
The Journal also reports that the FTC has already begun to reach out to people associated with companies that Facebook has purchased. Aside from WhatsApp and Instagram, Facebook has also acquired Oculus VR, FriendFeed and LiveRail, among others. The company bought Instagram for $1 billion in 2012 and WhatsApp for $19 billion in 2014.
The current antitrust laws (known as the Sherman Act) outlaws, “every contract, combination, or conspiracy in restraint of trade,” and any “monopolization, attempted monopolization, or conspiracy or combination to monopolize.” If Facebook is found to have purposely acquired up and coming platforms so as to keep themselves at the top of the food chain, it could be be bad news for the world’s biggest social networking coming.
This new investigation comes on the heels of a $5 billion settlement between the FTC and Facebook that was agreed upon on July 24. The historic settlement is a result of violations Facebook made from a previous settlement with the FTC in 2012. As part of last week’s settlement, Facebook is required to designate compliance officers who will be responsible for the new privacy program. The social network will also have to implement an independent privacy committee of Facebook’s board of directors, which will be charged with creating greater accountability.
The Department of Justice announced a broad antitrust review into Big Tech, most likely including Facebook, Amazon, Apple and Google, on July 23. The department initially provided few details, only saying they would look into, “whether and how market-leading online platforms have achieved market power and are engaging in practices that have reduced competition, stifled innovation, or otherwise harmed consumers.”
The Democratic-led House Judiciary Committee also began an investigation into these same platforms last month to determine if these companies prevent outside competition or if they hurt consumers.
Digital Trends reached out to both Facebook and the FTC to comment on the probe, but have not received a response.