It's kind of hard to argue that Facebook has a monopoly on "social media" when there's so much actual competition for attention in the same space. Twitter, TikTok, Snapchat, iMessage, Youtube, etc. Yeah, there is no other Facebook-style social network to share photos of your grandkids or whatever, but no one under the age of 30 even uses that these days and it's hard to argue that it's as deserving of government intervention as oil, railroads, or telecom in general were.
I'd be looking much more closely at Amazon (nearing a monopoly on e-commerce, soon to be all commerce) and Google (an actual monopoly on search) if I were the government...
It is even harder to argue this when Facebook's customers are advertisers, not users (which are a resource). Facebook does not have a monopoly on advertising. But this is the best avenue to show it does consumer harm, which is the legal critera for a monopoly. Here, "consumer" would be advertiser. How Facebook treats advertisers is going to determine the legality of any monopoly claim, regardless of whether people intuitively believe Facebook is "too big". To make that be a criteria for breakup, one would need to change the law, not issue any directives from administrators.
We do not really have a law on services that treat users as a resource. There is a clear need of innovation here. GDPR is a tiny step in this direction.
Interesting point. Facebook has 2.8B active monthly users. How many does the next highest one have? TikTok has 680M which is not even a quarter of that.
What do the numbers look like in the US though? I did some googling and found about 190M for Facebook, 80M for TikTok, and 70M for Twitter. I don't know how accurate the numbers are, because they were from pretty sketchy sources. But if the real numbers are anywhere close to that, then that does make it seem like Facebook has a fair few competitors.
Aggregate spent time is probably the most interesting metric.
Plus, if a service visibly dominates in some demographics (e.g. 35-50), is it a "local monopoly" in the same sense as if it dominated in a geographic region, say, the Midwest?
Because if all your friends and colleagues and schoolmates use service X, you are strongly incentivized not to go to another competing service where only much younger / much older people are.
Not many care about monopolies. We care and want fair competition. Each of the companies mentioned in your comment don't matter except where they are anticompetitive (FB is based on what Mark says alone and Amazon appears to be based on their Amazon basics and similar patterns, as I recall Apple has right to repair related issues tangent to this and Google and Apple colluded on fixing salaries, not sure about the details here...). None of this has to do with monopolies.
Facebook seems like the least of the big techs that are the most abusive of monopoly (outside of netflix). Google is by far the most abusive, Apple is the most locked down, Amazon is the most disruptive. Facebook is just for casual communication and isn't as business impacting.
Facebook is the most anti-competitive of them all IMO. "Monopolist" and "anti-competitive" are overlapping yet distinct legal concepts in antitrust law. Facebook had a well known "buy or bury" strategy where they would either buy their competitors or try to destroy them. What is interesting is that IMO FB has had antitrust pressure before google/apple/amazon and this basically froze FB's M&A teams for the past ~4 years. In this time we have seen 4 new promising independent social media networks arise (tiktok, dispo, clubhouse, substack). IMO without the antitrust pressure against FB the current state of social media would be more consolidated, less likely that these 4 new networks would be independent/growing quickly at this stage.
Amazon told diapers.com sell to us or we will sell diapers at below cost until you run out of money. Maybe I am just old and the "real" world seems much more legit than the social media world. Sure Facebook bought a lot of companies, but there isn't a ton they do to smoosh them together. They seem pretty independent. Facebook's ability to kill seems weak. TikTok is still doing well and Reels didn't eat into them. Clubhouse is new and up and coming. Much more competitors than new search engines (which isn't even what Google really is anymore). Apple does have more a variety and mix of competition as well as less market share than the other Tech giants.
What are facebook acquisitions where the acquired companies have remained independent? Whatsapp, Instagram, and oculus seem like they have been assimilated a good amount.
re: tiktok and clubhouse
I think the op made a good point about the Facebook m&a spree being put on hold due to their legal troubles a few years back and now can only try to clone/crush competitors now. They cloned tiktok and wouldn't be surprised to hear they have a clubhouse clone in the works.
From where I sit Facebook appears the most brazen about their anti-competitive practices especially when compared to Google. Their tightly held walled guarden, forcing oculus to use facebook accounts, etc. Android allows 3rd party market places, Google's products in general have low switching cost (from gmail, calendar, etc to 3rd party stuff). Their ad network is pretty pervasive there and hard to escape just because of the size and Google's push for AMP on the web when so many were against it does seem like flexing their monopolistic strength.
Facebook forcing Oculus to use Facebook accounts is a small drop in the ocean compared to Google’s acquisition of DoubleClick. I find your take to be disingenuous at best.
Now if you talked about Onavo we might be on to something.
except for the whole destroying political discourse in our country accelerating polarization spreading disinformation and acting as a tool of radicalization. not to mention leading to increased rates of depression in it users.
Even better is “The Attention Merchants.” Pair that with Zuboff’s “The Age of Surveillance Capitalism” and you’ll have a good foundation for how dangerous Facebook is. Something needs to be done. Monopoly is a means to an end here, but it might not get the job done. What need is a ban on behavioral advertising full stop.
In related news, Tim Wu has accepted an appointment to serve the Biden Administration on the National Economic Council.
"White House signals coming antitrust push with Tim Wu appointment"
Wu will be serving on the National Economic Council as special assistant to the president for technology and competition policy, the White House said this morning. Wu confirmed the news in a tweet.
That may be, but I think it's all for show. It's unlikely that anything will happen for years, and by that time there will probably be a different president. Look at the Microsoft anti-trust action, which started in the 90's but didn't really finish until the early 2000's. If the government tries to force something like a breakup, then I imagine any company will spend years in court going through appeals before anything will be resolved.
Most likely is that after a few years, any company targeted with anti-trust action will agree to some changes in the way they do business and maybe a fine. Then all will be forgotten. It's likely that the changes will be pro-consumer, but I think it's unlikely that any company will be broken up.
Are there a meaningful number of people on the capital side who didn’t support Biden? (Or Obama for that matter?)
Labor’s politics usually doesn’t match capital’s and management’s. In the auto industry owners and managers long voted Republican and workers voted Democrat, for obvious reasons. I’ve always found it odd that didn’t seem to be true for tech. At the very least, it’s a pretty aggressive bet on the AOC/Warren wing never taking power.
This is not a comment on the merits. I think Wu is a bright guy and some antitrust scrutiny of tech is probably in order.
There have been several notable names. Peter Thiel, Larry Ellison, and Scott McNealy, off the top of my head.
Most Trump supporters kept it pretty much on the down low. Doug Leone (Sierra Capital) seems to be named most often, though even he broke after the January 6 Coup. Brian Krzanich (Intel) was, so long as nobody heard about it. Palmer Luckey (Facebook), David Blumberg (Blumberg Capital).
Vocally opposed: Meg Whitman, Marc Andreessen, and John Chambers (ex-Cisco), all notably conservative.
Keep in mind too that dark money and Citizens United most especially makes true support difficult to trace. Arguing that there are no names whilst the names that exist can and often do utilize secret funding mechanisms is highly disingenuous.
Excellent article and remarkably easy to identify the anticompetitive behavior which is the fundamental issue. Add to this CA Prop 22, among other related problems it'll be interesting to see what government does to exercise its power appropriately and encourage competition in the market. Appreciate the clarity Tim Wu and Wired contribute.
FB is no different or better than big oil or big telco. Hopefully the people who work there begin to realize the damage they are doing to this country.
>Hopefully the people who work there begin to realize the damage they are doing to this country.
They might not realise it now but I suspect they would should they leave. I for one would feel very uncomfortable working with someone who's ex-Facebook and I don't think I'm alone in that regard. FWIW the damage Facebook's caused goes far beyond the United States.
Oil's network effects are largely on the production and distribution side. Rockefeller bought out refineries and negotiated railroad rebates ... on both his own and competitors' shipments (the latter paid to him, not the competitors).
Telephony very much has network effects, which played a key role in how AT&T built its monopoly (early 20th century).
As do other "network corporations": railroads, commodity trusts, wholesale and retail, banking, information services, higher education.
I'd be looking much more closely at Amazon (nearing a monopoly on e-commerce, soon to be all commerce) and Google (an actual monopoly on search) if I were the government...