Top US lawmakers hail antitrust lawsuits against Facebook

Noting that the accountability was "long overdue", top US lawmakers have hailed the twin antitrust lawsuits against Facebook that accused the social media giant of abusing its dominance in the digital marketplace and engaging in anti-competitive behaviour.

However, public policy think tank Information Technology and Innovation Foundation (ITIF) said the lawsuits, filed by the Federal Trade Commission (FTC) and 48 states on Wednesday, threaten both US competitiveness and consumers.

“Rather than competing with Instagram and WhatsApp, it appears Facebook simply bought these firms to expand its dominance," said House Judiciary Committee Chairman Jerrold Nadler.

"As a result, Facebook has illegally maintained its monopoly, allowing it to engage in other abusive conduct. This should never have happened in the first place, and accountability is long overdue,” he said.

Since June 2019, the House Judiciary Committee has led a bipartisan congressional investigation into the state of competition in digital markets, which included an examination of Facebook’s dominance online.

In July, the House Judiciary Antitrust Subcommittee held a hearing with Facebook CEO Mark Zuckerberg along with the CEOs of other major technology firms as part of the panel's investigation. In October, the Committee published a comprehensive Majority staff report, which found that Facebook has abused its monopoly power in the social networking market.

Congressman Joe Neguse, Vice Chair of the House Judiciary Subcommittee on Antitrust, Commercial and Administrative Law, said the Antitrust Subcommittee’s investigation of digital markets uncovered wide-ranging evidence that Facebook used its market power to acquire, clone, or eliminate its competitive threats in order to maintain its monopoly in social networking.

“It’s purchase of Instagram and WhatsApp have allowed Facebook to own the top four most downloaded apps of the last decade. Left unchecked, Facebook’s monopoly will remain harmful to consumers, innovation and our democracy. Today’s antitrust lawsuits against Facebook is a welcome step to ensuring we have robust competition in the digital marketplace, and it is long overdue,” he said.

According to House Antitrust Subcommittee Chairman David N Cicilline, who oversaw a 16-month long investigation into the market dominance of major tech platforms, in the absence of competition and accountability, Facebook has harmed people's privacy and allowed disinformation to flourish on its platform.

The lawsuits "marks a major step in our ongoing work to bring the tech industry's monopoly moment to an end," he said.

Senator Mike Lee said the antitrust enforcers are finally taking the threats posed by Big Tech seriously.

Senator Richard Blumenthal, a member of the Senate Judiciary Committee and the Senate Commerce, Science and Transportation Committee, said the lawsuits "should set a new standard for how we fight back against entrenched corporate power".

In November, Blumenthal served as the Ranking Member at the Senate Judiciary Committee hearing on "Breaking the News: Censorship, Suppression, and the 2020 Election." In an exchange with Zuckerberg, Blumenthal called for strong enforcement by the FTC to address Facebook's dominant market power and anti-consumer policies.

Indian-American Congresswoman Pramila Jayapal said in August, she repeatedly asked Zuckerberg about the well-documented instances of Facebook copying, acquiring and killing their competitors. “I'm glad to see this lawsuit as we rein in anti-competitive behaviour, help prevent monopolistic practices and allow innovation to thrive,” she said.

Senator Mark Warner tweeted that for nearly two years now, he has been saying that the purchases of WhatsApp and Instagram should never have been approved and need to be reversed.

Senator Amy Klobuchar said the lawsuits "means a new dawn for American competition policy".

Meanwhile, Information Technology and Innovation Foundation president Robert Atkinson said the antitrust actions "threaten both US competitiveness and US consumers".

Silicon Valley enjoys tremendous success globally in part because US tech firms innovate quickly, including through acquisitions that allow them to bring in new talent, intellectual property, and more users. Companies and investors are going to lose faith in regulators if policymakers want to reverse course on prior decisions and call a mulligan this late in the game, he said.

“Moreover, the proposed remedy — divesture of Instagram and WhatsApp — would cause a massive disruption to these services, negatively impacting consumers and businesses who rely on their services," Atkinson said.

Jennifer Newstead, vice president and general counsel of Facebook, said when the company acquired Instagram and WhatsApp, they believed these companies would be a great benefit to its Facebook users and that they could help transform them into something even better.

“And we did. This lawsuit risks sowing doubt and uncertainty about the US government’s own merger review process and whether acquiring businesses can actually rely on the outcomes of the legal process. It would also punish companies for protecting their investment and technology from free-riding by those who did not pay for the innovation, making those companies less likely over the long term to make their platforms available to spur the growth of new products and services,” she said.

Image credits: AP