Facebook's acquisition practices under probe

WASHINGTON • The United States Federal Trade Commission (FTC) is investigating whether Facebook acquisitions were aimed at buying up potential rivals before they could become a threat to the social media firm, The Wall Street Journal reported on Thursday, citing people familiar with the matter.

Facebook's acquisition practices are the main focus of the probe, as the FTC looks into the firm's buying of technology-based start-ups to keep them from challenging it, the report said.

The world's largest social network has bought nearly 90 firms since 2003, according to data provided by S&P Global.

These include messaging service WhatsApp and image-sharing app Instagram, both of which have since grown into social behemoths in their own right.

Facebook last week said the FTC had opened an antitrust investigation in June, looking into the areas of "social networking or social media services, digital advertising, and/or mobile or online applications". Both the FTC and Facebook declined to comment on the report.

The US Justice Department said on July 23 that it was opening a broad review of major digital tech firms, looking into whether they engage in anti-competitive practices, a clear signal that US President Donald Trump's administration is stepping up its scrutiny of the industry.

In June, Reuters reported that the FTC and the Justice Department, which enforce US antitrust laws, have divided oversight over the big four tech firms, with Amazon and Facebook under the watch of the FTC, and Apple and Google under the Justice Department.

Last month, Facebook settled an FTC probe into allegations of inappropriate sharing of data of 87 million users with the now-defunct British political consulting firm Cambridge Analytica. Facebook will pay a record-breaking US$5 billion (S$6.9 billion) fine.

According to its most recent figures, more than 2.7 billion people use one of Facebook's family of apps each month.

While Facebook does not release user or revenue figures for each service, executives presenting the firm's earnings last week cited Instagram as a key driver of ad impression growth, the company's main source of revenue.

REUTERS

A version of this article appeared in the print edition of The Straits Times on August 03, 2019, with the headline 'Facebook's acquisition practices under probe'. Print Edition | Subscribe