Big Tech, Little Trust: US states to launch antitrust and privacy enquiries into Facebook and Google

September 18, 2019

2 min read

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What's going on here?

Facebook and Google are facing investigations in the US for breaching antitrust laws. The new investigations are indicative of a trend of growing scrutiny of big tech firms in the US.

What does this mean?

Antitrust laws protect against the concentration of power by companies over any given industry. They exist to promote competition in many markets for the benefit of consumers.

The investigation launched into Facebook will focus on their privacy record and advertising model. This comes amidst accusations that Facebook have been participating in anticompetitive conduct including copying features from competitor apps and even acquiring rival tech firms. According to New York Attorney General Letitia James, Facebook’s actions have “endangered consumer data, reduced the quality of consumer choices, or increased the price of advertising”.

The details of the inquiry into Google are less specific, but it will be expected to examine their effect on the digital advertising market and its impact on consumers.

What's the big picture effect?

This is not the first antitrust or privacy investigation for either Google or Facebook. Google has already faced a total of €8.26 billion in fines from the EU in three separate antitrust cases. Additionally, earlier last week, Google and its subsidiary YouTube, agreed to pay $170 after accusations emerged of them illegally gathering children’s data without the consent of their parents.

As for Facebook, they recently faced charges of $5bn following a high-profile privacy investigation which claimed that they failed to protect their users data from Cambridge Analytica. Earlier this year the US launched an investigation into data sharing deals with 150 major tech companies (see our article on that here).

These cases come as a threat to the business models of big tech companies, with politicians such as US Senator Elizabeth Warren threatening to ensure the breakup of these giants to prevent them from dominating the tech industry and stifling smaller competitors.  With regulations becoming harsher, law firms need to ensure that their tech clients adhere to antitrust legislation, as it could come at a larger cost to these tech giants than just money.

Report written by Juliet Majekodunmi

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