The D.C. district court dismissed the FTC complaint (PDF) on Monday, saying that the agency hadn’t proved that Facebook dominates its market. According to the court, “the Complaint contains nothing on that score save the naked allegation that the company has had and still has a ‘dominant share of th[at] market (in excess of 60%),’” but the FTC didn’t explain how it came up with that figure. The ruling says that the FTC could file an amended complaint within 30 days, if it chooses to.
The case brought by the states was dismissed outright (PDF) because too much time had elapsed since Facebook purchased Instagram and WhatsApp, the court ruled.
“We are pleased that today’s decisions recognize the defects in the government complaints filed against Facebook,” a company spokesperson said in a statement. “We compete fairly every day to earn people’s time and attention and will continue to deliver great products for the people and businesses that use our services.”
Consumer advocates say that battles over the size and power of the biggest technology companies will continue. A 2020 nationally representative CR survey of 3,219 U.S. adults (PDF) revealed that Americans have deep concerns about the outsize influence of the nation’s tech companies. Three out of 4 worry about the power wielded by platforms such as Amazon, Facebook, and Google. And 8 in 10 say the mergers and acquisitions that helped them grow undermine competition and consumer choice.
Advocates worry that the biggest platforms have too much control over the flow of information, influencing what people see and read, and what messages are promoted or suppressed.
“Facebook is clearly a monopoly,” says Sumit Sharma, senior researcher for technology competition at Consumer Reports. “But breaking it up will always be hard to do.” Several bills recently introduced in Congress may have a better chance at making important changes to the way that Facebook and other tech giants do business—even if they don’t result in the company splintering.
One of the bills, for example, requires companies to make it easier for consumers to switch from one platform to another. Another one would require large companies that want to make an acquisition to prove the purchase wouldn’t harm competition. (Currently, the burden is on regulators to show that a merger would be harmful in order to block it.)
“These are good ways to encourage and make space for more competition,” Sharma says.
The FTC has more options, too. It can choose to refile the complaint, or take action under Section 5 of the FTC Act, which bans unfair and deceptive acts and practices. “Lina Khan, the FTC’s new chair, is proposing to use the FTC’s Section 5 powers more aggressively,” Sharma says. “The dismissal of this complaint lends urgency to such use.”
