Facebook Emails Could Lead to Tougher EU Regulatory Scrutiny

Facebook emails showing the company threatened to cut off data to potential rivals added a new target for the regulatory armory being amassed by European regulators, according to Bloomberg.

The publication of the emails by U.K lawmakers preceded a vote by EU legislators that backed draft rules requiring online platforms to treat businesses, including rivals, fairly. In the new year, Germany will conclude an antitrust probe that may call on Facebook to change privacy terms. The revelation of the emails "confirms something is rotten in how Facebook treats consumers’ data," said Ramon Tremosa, a member of the European Parliament. It "clearly raises a few questions about how Facebook treats users’ data and their policies for working with app developers.

A trove of internal correspondence published online provided a look into the ways Facebook executives, including CEO Mark Zuckerberg, treated information posted by users like a commodity that could be harnessed in service of business goals. Apps were invited to use Facebook’s network to grow, as long as that increased usage of Facebook. Certain competitors, in a list reviewed by Zuckerberg himself, were not allowed to use Facebook’s tools and data without his personal sign-off.

New legislation might require Internet giants to treat rival services "equally without discrimination" with some exceptions, according to rules voted by EU lawmakers. Their version still needs to be backed by the full European Parliament, likely this week, and then the final text of the law must be negotiated with EU governments.

Germany already sees Facebook as the country’s dominant social network, which puts the company on warning. The German Federal Cartel Office probe focuses on the way the social network scoops up information on how users surf the web. Any changes required by regulators may affect its ability to sell useful ads on the network.

The power internet giants wield with access to user data and the ability to crush rivals by cutting off links to it, is increasingly a focus for European regulators. Both the EU and Germany are looking at how Amazon treats sellers on its platform, with the EU zeroing in on the advantage it gets on rivals’ bestselling items to check if it then starts selling its own-brand copycats.

Microsoft and Apple got scrutiny over how they might choke off rivals’ access in EU probes of their takeover plans. Facebook escaped a long probe from the EU over the deal but was later fined 110 million euros for failing to disclose how it could link data between services.