Home News World news
Facebook sued over 'illegal monopoly' claims and told to sell off Instagram and WhatsApp by US Govt
The Federal Trade Commission (FTC) and a coalition of US states are suing the social media giant on the grounds it has employed a "systematic strategy" to eliminate its competition.
Two legal actions are seeking "remedies" for the alleged anti-competitive conduct that could eventually force Facebook to sell both the huge apps, reports AP.
The FTC said in a statement it would seek an injunction that "could, among other things: require divestitures of assets, including Instagram and WhatsApp."
In its complaint, the coalition of 46 states, Washington, D.C. and Guam also asked for Facebook's acquisitions of the two well-known tech brands to be judged to be illegal.
The FTC alleges Facebook engaged in a systematic strategy to eliminate threats to its monopoly, including the 2012 and 2014 acquisitions of the two apps, which it had previously cleared.
It alleges Facebook now holds monopoly power in the U.S. personal social networking market.
Facebook acquired Instagram for $1 billion and WhatsApp for $19 billion.
The company's stock was down almost four per cent following the news of the lawsuits.
They were announced by the Federal Trade Commission and New York Attorney General Letitia James.
"It's really critically important that we block this predatory acquisition of companies and that we restore confidence to the market," she said.
In its lawsuit, the FTC is seeking the separation of the services from Facebook, saying it has engaged in a "a systematic strategy" to eliminate its competition, including by purchasing smaller up-and-coming rivals.
James echoed that in her press conference, saying Facebook "used its monopoly power to crush smaller rivals and snuff out competition, all at the expense of everyday users."
Facebook is the world's biggest social network with 2.7 billion users and a company with a market value of nearly $800 billion.
Its CEO Mark Zuckerberg is the world's fifth-richest individual and the most recognisable face of Big Tech.
Facebook said today: "We're reviewing the complaints & will have more to say soon.
"Years after the FTC cleared our acquisitions, the government now wants a do-over with no regard for the impact that precedent would have on the broader business community or the people who choose our products every day."
Source: the sun
China builds giant quarantine camp for 4,000 people amid fears of another massive Covid outbreak
FBI vets service members ahead of inauguration amid reported fears of insider attack