Facebook’s messaging merger leaves lawmakers questioning the company’s power

On Friday,
The New York Times reported
that Mark Zuckerberg
is planning to integrate the underlying infrastructure of
Facebook Messenger, Instagram, and WhatsApp, allowing users to
message each other between apps. At its face, this move could
bring some serious advantages for consumers, but lawmakers,
regulators, and security experts are already beginning to
question whether the benefits outweigh the consequences.

“Good for encryption but bad for competition and privacy,” Sen.
Brian Schatz (D-HI), the ranking member of the commerce
subcommittee’s panel on technology, tweeted
yesterday
.

“Once again, Mark Zuckerberg appears eager to breach his
commitments in favor of consolidating control over people and
their data,” Sen. Richard Blumenthal (D-CT) said in a statement
to The Verge.

Facebook is the largest social media network by far, with
over
2 billion users
across properties and roughly 1.5 billion
users who log into at least one of the services every day. In
2011, the Federal Trade Commission
first knocked Facebook
, saying that the company deceived
users into believing they could keep their information private,
telling users they could privately post content, when in some
cases, their friends lists, posts, and statuses were all
public. But after over 70 acquisitions, the Department of
Justice has never moved to stop Facebook from acquiring a
company.

A majority of those acquisitions were US-based companies, many
of them founded in close proximity to the Facebook campus. The
products those companies made were often shut down after the
acquisition, and the former employees were brought in to work
on Facebook’s own endeavors, at times swallowing much of
Silicon Valley’s talent and what could have been competing
products.

“Imagine how different the world would be…”

“This is why there should have been far more scrutiny during
Facebook’s acquisitions of Instagram and WhatsApp which now
clearly seem like horizontal mergers that should have triggered
antitrust scrutiny,” Rep. Ro Khanna (D-CA), a lawmaker who
represents much of Silicon Valley, said on Friday. “Imagine how
different the world would be if Facebook had to compete with
Instagram and WhatsApp. That would have encouraged real
competition that would have promoted privacy and benefited
consumers.”

Last year, lawmakers and regulators focused primarily on the
fallout of
the Cambridge Analytica scandal
, which resulted in over 87
million Facebook users being deceived into handing over a huge
trove of their personal data. The
European Union implemented its own set of data privacy

rules last spring as part of a larger data initiative, but
Facebook has only been met with relatively meager fines.

That could change this year. Congressional leaders have made
significant steps to rein in tech giants, and they are
beginning to question the market power of companies like
Facebook and Google. Just this month, the new Senate Judiciary
chairman, Sen. Lindsey Graham (R-SC), said he would like to
hold more hearings involving the tech sector, comparing Silicon
Valley to the “Wild West.”

Blumenthal, a member of the powerful Judiciary Committee, took
a similar line in a statement to The Verge, “Facebook
and Google’s dominance over data has already harmed consumers
and the economy. The FTC and the Department of Justice must
take Big Tech’s invasive, anticompetitive practices seriously
and begin to vigorously enforce our laws.”

President Trump’s nominee to lead the Justice Department,
William Barr,
has said he’d like the agency to play a bigger role
,
suggesting he would reevaluate how resources in departments
like the antitrust division were prioritizing tech.

“We cannot allow platform integration to become privacy
disintegration.”

If Facebook were to come under real scrutiny by antitrust
regulators, Instagram and WhatsApp would likely be their first
two targets. By 2020, the messaging merger between Facebook’s
top properties will likely be complete, making it even more
difficult for them to be torn apart by regulators in the
future. No longer could officials make the argument that they
could easily be spun back off into their own companies.

Last November,
President Trump told Axios
that the federal
government was actively studying whether companies like
Facebook, Amazon, and Google had violated antitrust law.
Trump’s own antitrust head, Makan Delrahim,
has repeatedly said that these anti-competitive concerns are
valid
, but he was unsure whether there is enough economic
evidence to prompt penalties or even break-ups just yet.

If the FTC or the Justice Department were to pursue a breakup,
they couldn’t simply make the argument that Facebook was too
big. Antitrust laws like the Sherman Act don’t call for
breakups just because a company is big and powerful. But, if
the government found that Facebook had stifled competition in a
way that harmed consumers, the department could potentially
pursue criminal action that would result in breaking Facebook
up.

On Thursday, advocacy groups like Color of Change and the Open
Markets Institute
called on the FTC to reestablish
WhatsApp and Instagram as
independent companies, not because it has broken antitrust
laws, but because “Facebook breached its commitments to the
Commission regarding the protection of WhatsApp user data,”
they said. As a consequence, the groups requested that the FTC
penalize the breach of an agreement with a breakup.

Security experts have also raised concerns that merging the
services could weaken WhatsApp’s end-to-end encryption. As of
right now, WhatsApp is the only real messaging service that
offers default encryption. In order to allow cross-messaging,
it’s unclear whether WhatsApp’s encryption could be weakened to
better allow interoperability.

“When it comes to privacy, we can no longer give Facebook the
benefit of the doubt,” Sen. Ed Markey (D-MA) said in a
statement Friday. “Now that Facebook plans to integrate its
messaging services, we need more than mere assurances from the
company that this move will not come at the expense of users’
data privacy and security.

“We cannot allow platform integration to become privacy
disintegration.”

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