Press Release: @FTC Unanimously Votes to Examine Past Acquisitions by Large Technology Companies

PRESS RELEASE

The Federal Trade Commission issued Special Orders to five large technology firms, requiring them to provide information about prior acquisitions not reported to the antitrust agencies under the Hart-Scott-Rodino (HSR) Act. The orders require Alphabet Inc. (including Google), Amazon.com, Inc., Apple Inc., Facebook, Inc., and Microsoft Corp. to provide information and documents on the terms, scope, structure, and purpose of transactions that each company consummated between Jan. 1, 2010 and Dec. 31, 2019.

The Commission issued these orders under Section 6(b) of the FTC Act, which authorizes the Commission to conduct wide-ranging studies that do not have a specific law enforcement purpose. The orders will help the FTC deepen its understanding of large technology firms’ acquisition activity, including how these firms report their transactions to the federal antitrust agencies, and whether large tech companies are making potentially anticompetitive acquisitions of nascent or potential competitors that fall below HSR filing thresholds and therefore do not need to be reported to the antitrust agencies.

“Digital technology companies are a big part of the economy and our daily lives,” said FTC Chairman Joe Simons. “This initiative will enable the Commission to take a closer look at acquisitions in this important sector, and also to evaluate whether the federal agencies are getting adequate notice of transactions that might harm competition. This will help us continue to keep tech markets open and competitive, for the benefit of consumers.”

The Special Orders require each recipient to identify acquisitions that were not reported to the FTC and the U.S. Department of Justice under the HSR Act, and to provide information similar to that requested on the HSR notification and report form. The orders also require companies to provide information and documents on their corporate acquisition strategies, voting and board appointment agreements, agreements to hire key personnel from other companies, and post-employment covenants not to compete. Last, the orders ask for information related to post-acquisition product development and pricing, including whether and how acquired assets were integrated and how acquired data has been treated.

The Commission plans to use the information obtained in this study to examine trends in acquisitions and the structure of deals, including whether acquisitions not subject to HSR notification might have raised competitive concerns, and the nature and extent of other agreements that may restrict competition. The Commission also seeks to learn more about how small firms perform after they are acquired by large technology firms. These and related issues were discussed during several sessions of the FTC’s 2018 Hearings on Competition and Consumer Protection in the 21st Century, and this study is part of the follow-up from those Hearings.

The FTC has a statutory right under the HSR Act to review acquisitions and mergers over a certain size before they are consummated, and the study will help the Commission consider whether additional transactions should be subject to premerger notification requirements. The orders will also contribute broadly to the FTC’s understanding of technology markets, and thereby support the FTC’s program of vigorous and effective enforcement to promote competition and protect consumers in digital markets.

The Commission vote to approve issuing the Special Orders was 5-0. Commissioners Christine S. Wilson and Rohit Chopra issued a joint statement.

The Federal Trade Commission develops policy initiatives on issues that affect competition, consumers, and the U.S. economy. Like the FTC on Facebook, follow us on Twitter, read our blogs, and subscribe to press releases for the latest FTC news and resources.

Must Read: @ranaforoohar: Fact-checking Facebook’s fantasies

Criticising Big Tech can feel redundant at a time when many chief executives in Silicon Valley are doing such a good job of making the public sceptical about their business models and their executive competence all by themselves.  Even so, Mark Zuckerberg’s speech at Georgetown University and his testimony on Capitol Hill last week are worthy of note. Facebook insists it does not want to be responsible for false political advertising. So I’d like to help Mr Zuckerberg out by fact checking a few of the points of disinformation in his own communications.

Read the post on FT.com

Natasha Bernal: Clegg calls on Europe to drop threats to break up Facebook and unite against China

In The Grand Deflection category, mark your calendars: Where were you the first time you heard the word “tech lash”? They are the spin they’ve been waiting for.

Facebook hires former senior government officials to lobby for Facebook to use its tools for more surveillance capitalism by roiling against the surveillance state that uses their tools to perfect the totalitarian state.

Welcome to The Party.

[Sir Nick Clegg t]he former deputy prime minister [and now lobbyist for Facebook] has said the social network plans to set up an independent oversight board to which people can appeal against content decisions made by Facebook.  [But wait…they’re a platform…they’re a publisher…they’re a platform….]

He also defended the company, saying it was the victim of a “tech lash”.

Read the post on The Telegraph

@nxthompson & @fvogelstein: 15 MONTHS OF FRESH HELL INSIDE FACEBOOK ‏

[In which The Boy Who Wouldn’t Grow Up and Wendy meet Captain Hook, Editor.]

CEO Mark Zuckerberg had recently pledged to spend 2018 trying to fix Facebook. But even the company’s nascent attempts to reform itself were being scrutinized as a possible declaration of war on the institutions of democracy. Earlier that month Facebook had unveiled a major change to its News Feed rankings to favor what the company called “meaningful social interactions.” News Feed is the core of Facebook—the central stream through which flow baby pictures, press reports, New Age koans, and Russian-­made memes showing Satan endorsing Hillary Clinton. The changes would favor interactions between friends, which meant, among other things, that they would disfavor stories published by media companies. The company promised, though, that the blow would be softened somewhat for local news and publications that scored high on a user-driven metric of “trustworthiness.”

Read the post on Wired.

Facebook and the Enemy Within: T-Bone Burnett’s Keynote at SXSW 2019

As usual, Henry gives an extremely relevant and literate dissertation on the loss of humanity imposed on us by Big Brother’s youngest sibling, Mark Zuckerberg–the boy who wouldn’t grow up, but who instead created an app for Room 101.

Please listen to T Bone when you have a quiet hour to yourself.

@davidtpegg: Facebook labelled ‘digital gangsters’ by report on fake news

Facebook deliberately broke privacy and competition law and should urgently be subject to statutory regulation, according to a devastating parliamentary report denouncing the company and its executives as “digital gangsters”.

The final report of the Digital, Culture, Media and Sport select committee’s 18-month investigation into disinformation and fake news accused Facebook of purposefully obstructing its inquiry and failing to tackle attempts by Russia to manipulate elections.

“Democracy is at risk from the malicious and relentless targeting of citizens with disinformation and personalised ‘dark adverts’ from unidentifiable sources, delivered through the major social media platforms we use every day,” warned the committee’s chairman, Damian Collins.

Read the post on The Guardian

@nickconfessore @laforgia_ gabriel-j-x-dance: Facebook offered users privacy wall, then let Spotify and other tech giants around it

For years, Facebook gave some of the world’s largest technology companies more intrusive access to users’ personal data than it has disclosed, effectively exempting those business partners from its usual privacy rules, according to internal records and interviews.

The special arrangements are detailed in hundreds of pages of Facebook documents obtained by The New York Times. The records, generated in 2017 by the company’s internal system for tracking partnerships, provide the most complete picture yet of the social network’s data-sharing practices. They also underscore how personal data has become the most prized commodity of the digital age, traded on a vast scale by some of the most powerful companies in Silicon Valley and beyond.

The exchange was intended to benefit everyone. Pushing for explosive growth, Facebook got more users, lifting its advertising revenue. Partner companies acquired features to make their products more attractive. Facebook users connected with friends across different devices and websites. But Facebook also assumed extraordinary power over the personal information of its 2.2 billion users — control it has wielded with little transparency or outside oversight.

The social network allowed Microsoft’s Bing search engine to see the names of virtually all Facebook users’ friends without consent, the records show, and gave Netflix and Spotify the ability to read Facebook users’ private messages.

Read the post on the New York Times.