U.S. State and federal investigators are planning to slap Facebook with antitrust charges as soon as November, four people familiar with the matter told the Washington Post. Such a lawsuit would mark the government’s latest crackdown on the biggest names in the tech industry, including Apple, Google and Amazon, for holding monopolies on their respective markets.
On Thursday, the U.S. Federal Trade Commission met privately to discuss the probe, and plans to file charges within the upcoming weeks, the sources, who spoke on the condition of anonymity, told the outlet. However, they cautioned that since work is ongoing, that timeline is still be ironed out and may be subject to change. Another investigation led by New York Attorney General Letitia James that 46 other state attorneys general joined last year has also been scrutinising Facebook on antitrust claims, particularly the company’s strategy of buying out potential competitors only to gut their businesses.
Sources said that state officials are “in the late stages of preparing their complaint” per the Post. A fifth person familiar with the matter told the outlet that investigators expect to have “an initial roster of participants” by Friday.
Officials seem to be pulling out the big guns this month, as this lawsuit would be the second major antitrust action against Big Tech in October. On Tuesday, the Department of Justice and 11 states filed an antitrust complaint against Google, arguing that it hamstrings other search engines by including its own permanent, preloaded search app on all Android phones, among other alleged anti-competitive tactics.
Federal officials began investigating Facebook for alleged anti-competitive practices after the company settled a Federal Trade Commission probe for $US5 ($7) billion over user privacy violations in the infamous Cambridge Analytica scandal. That fine, while record-breaking at the time, was fiercely denounced by critics who said it fell short of the punishment Facebook deserved for mishandling millions of users’ personal data. The FTC later launched an ongoing probe into Facebook’s purchase of its past rivals, Instagram and WhatsApp, and whether those acquisitions violated antitrust laws.
Other state and federal regulators soon followed suit. In a statement announcing the probe in October 2019, New York’s James said that state officials had grown “concerned that Facebook may have put consumer data at risk, reduced the quality of consumers’ choices, and increased the price of advertising.”
Facebook has vehemently denied these charges and pointed out that federal regulators had every chance to step in and stop the company from acquiring Instagram and WhatsApp. However, an investigation by a House Judiciary antitrust subcommittee that wrapped up earlier this month found that Facebook and several other Big Tech companies have repeatedly avoided scrutiny from the FTC. To wit, Facebook has acquired nearly 100 smaller companies over the years, only one of which, its purchase of Instagram in 2012, was closely vetted by regulators.
Unrelated to these antitrust charges, Facebook is also facing increased government scrutiny over its moderation practices in the wake of rampant misinformation about the pandemic and the 2020 presidential election on its platform. The Senate Judiciary Committee issued subpoenas this week for Facebook CEO Mark Zuckerberg along with another social media big wig, Twitter CEO Jack Dorsey, to testify about the platforms’ moderation policies as well as their alleged anti-conservative bias and censorship.