Might as well start with this:
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Some light reading: https://www.ftc.gov/system/files/documents/cases/1910134fbcomplaint.pdf
Just a request to break out Instagram and WhatsApp from Facebook, among other things
Seems like it’s going to be tough for them to win. FTC has to show that Whatsapp and Instagram were competitors to Facebook, but if that’s the case, Facebook can argue there are lots of other competitors in this space.
Also, its got to make the case quite a bit harder that the Whatsapp acquisition was approved by the FTC/DOJ. Think they would have to show that the market has become less competitive since then, when I think the opposite may be true.
I think they should have. The FTC sent a Second Request regarding the merger and these are the type of emails that normally should have been produced (i.e. documents that discuss competition between the two companies).
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The lawsuit doesn’t seem to mention the FTC approving either one of those acquisitions. Would be nuts if they had the emails referenced in the current suit, read them and were all OK bros you’re good to go.
Great job Obama Admin approving the Instagram deal, very on brand!
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A minor legal point here, but the FTC and DOJ don’t approve mergers in the U.S. They just decide not to challenge them. This is different from some other jurisdictions where regulators do explicitly approve mergers.
This certainly isn’t the first time that a US agency has sued to undo a merger that it previously reviewed and declined to challenge, although it is unusual.
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That is a fair point and I should have been more precise with my language.
I would be curious to see how challenging a merger years after reviewing it will be addressed, as I’ve never dealt with that. Would think Facebook would have a pretty good equitable argument that if the mergers were anti competitive they should have been challenged initially, rather than after they spent all the money integrating the companies. Especially if they did produce the emails that are cited in the complaint.
Do the states have any say when the mergers are going through? If not then it shouldn’t impact their suit.
States can sue to block mergers independently of the federal agencies. A group of states recently unsuccessfully challenged the Sprint/T-Mobil merger.
How do you guys know so much about antitrust stuff? Very cool!
I did antitrust law for about 8 years.
As a side note, one of my friends is one of the lead FTC attorneys on the matter (but I have no inside info).
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this facebook lawsuit is a fucking clownshow. Instagram and whatsapp are approximately 0.5% of what’s wrong with facebook and splitting them off isn’t going to fix anything. The DOJ is staffed by a bunch of third-rate dullards if this is the best they could come up with.
They won’t give you seat on the Board if you dont approve the merger. That’s Regulatory Oversight 101 dude.
I don’t really think approving the instagram merger is relevant at all. At the time, instagram was essentially a nobody, everyone thought the deal was insane and that insta was not worth even a fraction of the $1B price, and it was generally seen as a hugely risky move for zuck.
and again, the insta purchase did approximately zero to enable the truly destructive apparatus that zuck is controlling today.
I honestly don’t even know how you could “fix” Facebook. Like their actual market is micro-targeted ads based on spying on their users, for which they definitely have a strong market position, but like, the problem is that the markets exists at all.
Separately, deliberately spinning stupid people into a blind rage with right wing lies seems bad but doesn’t seem to have much to do with being a monopoly.
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there’s something facebook doesn’t have a monopoly on
The reason its relevant is that the FTC cites the Instagram merger as evidence the FB was trying to eliminate its key competitors through acquisitions. A monopoly isn’t per se illegal, but you can’t use certain means to acquire/maintain monopoly power - one of which is eliminating competition through acquisition. If Instagram wasn’t a key competitor at the time of the acquisition and only became significant after FB acquired it and developed it, then it makes the FTC argument about eliminating competition much weaker.
The FTC needs to show that FB isn’t a monopoly just because it offers a superior product that everyone preferred to MySpace, etc.