(UnitedVoice.com) – Finally, it appears that there’s something Democrats and Republicans agree on, even if the motives aren’t aligned. For some time, both parties were on the same page when it came to Big Tech. Amazon, Apple, Facebook, and Google are monopolistic companies that are too big and too powerful.
Facebook alone boasts a massive audience with 2.7 billion members. Its gross domestic product (GDP) is larger than all but 16 countries. Yet, on Monday, June 28, US District Judge James Boasberg wasn’t convinced and said an antitrust lawsuit brought by the Federal Trade Commission (FTC) failed to show that one of the world’s largest and most influential companies is a monopoly.
Is the Judge Alone on an Island?
The judge’s ruling could create complications for legal actions involving the other big tech companies as well. The FTC isn’t alone in its assessment that Facebook is a monopoly that dominates and squashes its competitors. Nearly all of the states’ attorneys general agree. Of the 50 states, 48 joined the FTC lawsuit saying Facebook abuses its monopoly power to eliminate any competition by either purchasing or burying competitive threats.
Since Facebook was founded 16 years ago as a social networking platform, it’s expanded rapidly into other fields. It bought Instagram and Whatsapp, intruded into messaging, photo, video, and virtual reality. Their primary means of growth wasn’t through internal innovation but through acquiring smaller companies before they got too large. In some instances, Facebook was willing to overpay.
Somehow, Judge Boasberg doesn’t understand the FTC’s and AGs’ perspectives or Facebook’s business model. Boasberg challenged the FTC’s assertion that Facebook dominates 60% of the social networking market. Its main competitor is Twitter, but it’s a fraction of the size of Facebook.
Facebook doesn’t make money from subscriptions to its service. The judge is right to recognize it’s free for the end-user. Well, kind of, but not really. Facebook allows people to use its service without paying money, but that doesn’t mean there isn’t a cost. Its terms of service allow the tech giant to know everything about someone. What they post, where they shop, who they hang out with, and more. They can even track through a mobile device.
The goal is to sell that information to advertisers at premium dollars — allowing them to efficiently target users. It’s profitable for both Facebook and its advertisers. The 2021 first-quarter earnings for Facebook rose 46% over 2020 for a total of $25.44 billion.
Not a Total Setback
While the judge’s ruling was a slight setback, it wasn’t a complete one. He gave the FTC until the end of July to improve its argument and file an updated legal complaint addressing his concerns.
However, if judges present challenges to anti-trust laws moving forward, it’s likely due to the law’s imperfections. That’s where Congress comes into play. While majorities in both political parties appear to agree there is an anti-trust problem, Congress may not have the bandwidth to change the laws. The main reason is that Democrats are more intent on their far-left agenda to transform America rather than to focus on big businesses, especially ones that finance them. There’s also the challenge of getting enough lawmakers to agree on something in an evenly divided House and Senate. One defection either way could spell trouble on divisive bills.
Stay tuned. This story will evolve later this summer after the FTC submits a new legal complaint.
Don Purdum, Independent Political Analyst
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