According to Facebook, a government effort to break up Facebook from Instagram and WhatsApp would defy established law, cost billions of dollars, and harm consumers.
The 14-page document, produced by lawyers at Sidley Austin and reviewed by The Wall Street Journal, offers a preview of the social-media giant’s defense as federal antitrust enforcers and members of Congress continue to pursue investigations into Facebook’s power and past competitive behavior. Probes of other technology companies such as Alphabet, Google, Amazon, and Apple are also ongoing.
The House Antitrust Subcommittee this month is expected to release the findings of its investigation into Facebook and other companies, reported the WSJ.
The report stated separating the two apps from Facebook would be nearly impossible to achieve, cost billions, weaken security of the services, and harm users’ experience.
“A ‘breakup’ of Facebook is thus a complete nonstarter,” the document stated, according to WSJ.
But Tim Wu, a Columbia University law professor who has said Facebook should be broken up, told WSJ that Facebook’s insistence that the government’s approvals of the acquisitions in the past should limit action in federal court today is “surprisingly weak.”
He said the DOJ lawsuit would probably rely on the argument that Facebook made these acquisitions to reduce competition. That’s a question that wasn’t considered when the FTC chose not to oppose the Instagram and WhatsApp deals, he said, according to WSJ.
Wu also noted the fact that it would be difficult and expensive to break up the company’s divisions would not carry any weight in a courtroom.
“There is no ‘it’s too hard’ defense,’” Wu told WSJ.
In July, Facebook CEO Mark Zuckerberg defended the acquisition of Instagram to the House Judiciary Subcommittee on Antitrust, Commercial and Administrative Law. He said it was a natural extension of its global social media business and not an attempt to remove a potential competitor from the marketplace.
“It was not a guarantee that Instagram was going to succeed,” Zuckerberg said. “In hindsight, it looks obvious that Instagram reached the scale it has, [but] at the time, it was far from obvious.”
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