Facebook says the FTC is officially investigating it over antitrust concerns

Associated PressFILE – In this April 10, 2018, file photo Facebook CEO Mark Zuckerberg takes his seat to testify before a joint hearing of the Commerce and Judiciary Committees on Capitol Hill in Washington. The Washington Post reported on Tuesday, July 23, 2019, that the Federal Trade Commission will allege that Facebook misled users about its privacy practices as part of an expected settlement.(AP Photo/Alex Brandon, File)

In its earnings report on Wednesday, Facebook formally annoucned that is under investigation by the US Federal Trade Commission (FTC) over antitrust concerns.

In June, it had been reported that the FTC was preparing a potential probe, but the earnings report confirms that the investigation is formally under way. This is in addition to the broader investigation into Big Tech that the Department of Justice (DOJ) had announced on Tuesday.

The FTC confirmed with Business Insider on Wednesday that it has opened an investigation into Facebook.

According to a person familiar with the matter who spoke to Bloomberg, the probe will focus Facebook’s social media business. Bloomberg also reported that the FTC has already been in contact with third parties that could assist the agency in its investigation.

Earlier this summer, the groundwork was reportedly laid by the FTC and DOJ – the two departments with oversight over antitrust investigations – over which departments would carry out any possible probe into tech’s largest companies. It was reportedly decided then that the FTC would have antitrust jurisdiction over Facebook and Amazon, while the DOJ would be potentially responsible for any potential probe into Apple and Google.

This news suggests that those earlier reports were correct, though Facebook is the first of these Big Tech companies to acknowledge that is individually being investigated for antitrust matters.

In its second quarter earnings for 2019, the social media giant announced better-than-expected financial results, though the performance was coupled with confirmation of the antitrust investigation. Facebook’s stock initially spiked 5% in after-hours trading, but has now settled to around 1% up as of writing.

Read more:
Facebook beat Wall Street’s expectations for Q2 – but the FTC has opened an antitrust investigation

News of the antitrust investigation comes on the same day that the FTC finalised a $US5 billion fine against Facebook over claims that the company mishandled user data. As a part of the settlement, the FTC also imposed a slew of regulations on Facebook over how the company can handle user data.

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