On Wednesday, New York Attorney General Letitia James announced a massive antitrust lawsuit against Facebook, claiming the social network has harmed competition by buying smaller ones Companies such as Instagram and the whatsapp. Forty-seven other state and district attorneys general agree with her treatment.
The lawsuit focuses on Facebook's acquisitions, particularly the $ 1 billion Instagram market in 2011. In addition to the acquisition strategy, attorneys allege that Facebook used the power and scope of its platform to restrict user growth to competing services.
"For almost a decade, Facebook has used its dominance and monopoly power to crush smaller rivals and eliminate competition," James told a news conference.
"Facebook used huge sums of money to gain potential rivals before threatening the company's dominance."
The Federal Trade Commission filed a separate lawsuit against Facebook for similar reasons, which was announced at the same time as the lawsuit. The FTC case explicitly asks the court to break the dominance of the social network, dividing the Instagram and WhatsApp services into two independent companies.
"Our goal is to reverse Facebook's anti-competitive behavior and restore competition so that innovation and free competition thrive." said Ian Conner, Director of the FTC Competition Office.
Facebook, on the other hand, claims that both acquisitions were made in consultation with regulators and that their overthrow would be a dangerous precedent. "Years after the FTC approved our takeovers, the government now wants a change without taking into account the impact it would have on the wider business community or the people who choose our products on a daily basis," the company said.
Another dimension of the antitrust case is whether Facebook acquiring the companies made the product worse from a consumer perspective – especially in terms of privacy.
Facebook has long claimed that its resources and scale are responsible for turning apps like Instagram and WhatsApp into giants platforms with billions of users. However, the researchers consider how for example, its purchase WhatsApp from Facebook and his decision to use WhatsApp user data later may have harmed consumers and ruined competitors 'competition by exploiting users' privacy.