The Federal Trade Commission is looking into Facebook’s pattern of acquiring other companies to determine if the social media giant was buying up potential rivals to stymie competition, an investigation that could end up having much more serious consequences than its recent privacy settlement with the same agency.
Facebook first revealed the probe last month, just hours after the FTC announced that it had wrapped up its privacy investigation of the company which resulted in a $5 billion fine and requirements that the company take additional steps to safeguard users’ data.
If the FTC finds evidence that Facebook bought firms in order to block competitive threats, the agency could take steps toward breaking up the company. That would most likely take the form of a lawsuit like the one filed by the Justice Department against Microsoft in 2001. Although Microsoft was not broken up, the settlement had a huge impact on the software maker’s business for the next 20 years.
The FTC is talking to the founders of companies acquired by Facebook, the Wall Street Journal reported. If the FTC finds evidence of anticompetitive behavior by Facebook, it will escalate the investigation, if it has not already, which would include requiring the company to hand over confidential documents such as e-mails and business contracts.