On December 12, reports emerged that the Federal Trade Commission (FTC) may bring to court to prevent Facebook from moving ahead with its plans to integrate WhatsApp, Instagram and Messenger. The FTC has not asked Facebook to stop the integration, but it could file an injunction as soon as January. News of the potential regulation made some worry that it could force Facebook to sell WhatsApp and Instagram. As a result, shares were down 2.7 percent.
In March, Mark Zuckerberg, Facebook CEO, announced that Facebook had plans to integrate its messaging services to move towards more private social networking. Zuckerberg believed this would give users more choices to reach their friends. Facebook wants to let Messenger, WhatsApp and Instagram direct messaging communicate with each other while encrypting the messages. In other words, a user could send a message from Messenger to a WhatsApp user who does not have a Facebook profile. Some argue this move iterates the importance of WhatsApp and Instagram for Facebook and is an attempt to attract younger users, an area where Facebook has struggled as of late.
The FTC’s potential action would be from competition and future antitrust concerns. The FTC is afraid that if Facebook creates deepened bonds and ties between its products that it will be harder to break the company up in a future antitrust case.
The platforms are already partially integrated. Users can link their accounts and advertisers can use one system to place ads across the various platforms. If Facebook proceeded with the integration it would involve revising the apps to use the same software. Additionally, if these combine “more than 2.7 billion users would be able to access the same messages on the three different messaging services.”
The FTC would need three out of its five commissioners to approve the injunction in order to proceed. If Facebook receives an injunction, it could help the FTC lay the foundation for more investigations into Facebook.
Facebook is also under investigation for antitrust and privacy concerns.
