Magical Trade
Wednesday, October 4, 2023
  • Home
  • Trade News
  • Email Whitelisting
  • Privacy Policy
No Result
View All Result
  • Home
  • Trade News
  • Email Whitelisting
  • Privacy Policy
No Result
View All Result
Magical Trade
No Result
View All Result
Home Trade News

Facebook has already announced its first acquisition as Meta

by
November 5, 2021
in Trade News
0
0
SHARES
1
VIEWS
Share on FacebookShare on Twitter

In December 2020, the US federal government and 46 state attorneys general sued Facebook, claiming that its acquisitions of Instagram and WhatsApp violated antitrust law. But while the government is still struggling to convince a judge that Facebook is in fact a monopoly, Facebook is continuing to buy startups.

Last Friday, just one day after rebranding as “Meta,” Facebook announced that it’s acquiring Within, a Los Angeles-based startup behind the virtual-reality workout app Supernatural. Within has raised just over $52 million in investment to date, and Supernatural—which requires a subscription—has been available exclusively for Oculus, Facebook’s VR platform. The acquisition is Facebook’s sixth of 2021, according to Pitchbook, and at least its fifth VR acquisition in the past three years.

RELATED POSTS

Vehicles Sales increase to 15.67 million SAAR in September; Up 15% YoY

Does Putting Your Home in a Trust Protect It From Medicaid?

The deal highlights the mismatch between the pace at which the tech industry evolves and the pace at which law does. The US government brought its case against Facebook six years after the WhatsApp acquisition, and US courts move even slower. In August, the FTC refiled its case after a federal judge dismissed the suit, saying the agency hadn’t demonstrated that Facebook was a monopoly.

The deal also points to a paradox in current antitrust doctrine: To win its case against Facebook, the government needs to define the tech giant’s remit narrowly. And while the company’s VR buying spree is giving some Facebook watchers “Instagram-in-2012 vibes,” such acquisitions are unlikely to bolster an antitrust case focused on a photo-sharing and messaging app, respectively. That leaves Facebook plenty of runway to focus on its next decade while the courts are arguing about its last one.

In recent years, many academics and policymakers have warned of the power big tech platforms have to thwart competition, including by buying up nascent competitors. The FTC’s case against Facebook centers on its acquisition of Instagram in 2012 for $1 billion and Whatsapp in 2014 for $19 billion. The FTC alleges that “Facebook has systematically tracked potential rivals and acquired companies that it viewed as serious competitive threats.” Facebook claims those acquisitions were legal and led to the improvement of both apps—and that the FTC is ignoring its many competitors.

The key sticking point for the FTC is convincing a judge that Facebook is dominating its market; to do that, it wants to define Facebook’s market as narrowly as possible. The updated FTC complaint alleges that “Facebook holds monopoly power in the market for personal social networking services,” and that its next biggest competitor is Snapchat. It specifically says that these services operate in a different market from “content broadcasting” apps like TikTok and YouTube.

It stretches credulity to say that Instagram and TikTok don’t compete, but the choice is strategic: The narrower the market, the easier it is to show that Facebook holds a dominant market share. (US courts have generally required at least a 70% market share to rule that a company has market power.)

Meta’s acquisition of a virtual fitness app doesn’t change its market share in social networking, so it doesn’t directly bolster the FTC’s case. And Facebook would likely argue the very fact that it’s obsessing over the metaverse highlights the competition it faces as technology evolves.

On the other hand, FTC chair Lina Khan made her name with a paper arguing that US antitrust law was “unequipped to capture the architecture of market power in the modern economy” for just these reasons. She focused on Amazon, arguing that its power comes from its position spanning numerous markets—just as Facebook arguably gains its power from its position straddling “social networking services,” “content broadcasting,” and now VR.

But it’s not illegal in the US to be a big company spanning several markets. It’s illegal to impede competition. Regulators will need to make their case one market at a time.

ShareTweetPin

Related Posts

Vehicles Sales increase to 15.67 million SAAR in September; Up 15% YoY

by
October 4, 2023
0

Does Putting Your Home in a Trust Protect It From Medicaid?

by
October 3, 2023
0

Top CD Rates Today: 10 CDs Pay 5.75% or More for 6 to 17 Months

by
October 3, 2023
0

Market Update: BDX

by
October 3, 2023
0

Analyst Report: Becton, Dickinson And Co.

by
October 3, 2023
0

Next Post

The COP26 climate summit is drawing parallels to the disastrous Copenhagen meeting of 2009

Hong Kong's Hang Seng index leads losses in Asia as Chinese real estate shares fall

Leave a Reply Cancel reply

Your email address will not be published. Required fields are marked *

email

Get the daily email about stock.

Please Enter Your Email Address:



By opting in you agree to our Privacy Policy. You also agree to receive emails from us and our affiliates. Remember that you can opt-out any time, we hate spam too!

MOST VIEWED

  • Fund manager believes FAANG is dead — says now it’s all about MANTA

    0 shares
    Share 0 Tweet 0
  • Forget Tesla — this auto stock is the one to buy right now, analyst says

    0 shares
    Share 0 Tweet 0
  • Bank of America names its top global tech stocks — including one it says has upside of 100%

    0 shares
    Share 0 Tweet 0
  • This idiot-proof portfolio has beaten traditional stocks and bonds over 50 years

    0 shares
    Share 0 Tweet 0
  • Interactive Brokers’ Thomas Peterffy sees the stock market dropping another 15% from here

    0 shares
    Share 0 Tweet 0
  • Home
  • Trade News
  • Email Whitelisting
  • Privacy Policy
All rights reserved by www.magicaltrade.net
No Result
View All Result
  • Email Whitelisting
  • Home
  • Privacy Policy

All rights reserved by www.magicaltrade.net