Facebook Acquisitions Probed by FTC in Broad Antitrust Inquiry

The U.S. Federal Trade Commission is scrutinizing acquisitions by Facebook as part of an early stage antitrust investigation, according to Bloomberg, citing people familiar with the matter. The agency’s look at whether the company acquired upstarts to thwart competition is part of the broad probe into into several business lines.

The Trump administration is escalating antitrust scrutiny of technology giants. Last month, the Justice Department’s antitrust division announced a broad review into whether the companies are using their power to thwart competition. In February, the FTC set up a task force to investigate potentially anticompetitive conduct in the industry and look at past mergers to determine if they should be unwound.

Facebook’s critics, including co-founder Chris Hughes, have called for antitrust enforcers to break up the company, arguing it shouldn’t have been allowed to buy Instagram and the WhatsApp messaging service. Both deals were approved by the agency when they were announced, and persuading a court to undo them would be a steep challenge, according to antitrust experts.

If the FTC decided to bring a lawsuit to unwind the deals, despite having approved them, it would need to show that Facebook eliminated competitors by buying the apps. Facebook would counter that the companies only flourished because of the resources they gained from being part of the social-media company.

Facebook has argued repeatedly that breaking up the company won’t fix the tech industry’s biggest problems, those around election integrity and user privacy. Facebook has instead pushed for more government regulation, asking lawmakers to put guardrails in place to help dictate rules for the internet so tech companies don’t have to. Facebook’s top executives have also claimed, repeatedly, that breaking up the company might pave the way for companies from other countries, like China, to fill the void.