I agree and find the attempt at a breakup a bit frustrating. This is an action that could have profoundly disruptive effect and it's not really clear what the positives or negatives would be. For instance, FB has invested massively in trust and safety people operations and AI. What happens to that investment when IG is spun off?
Laying out laws and regulations so the market works as intended (no doubt with adjustments on the way) seems like the far preferable way to ensure healthy competition than taking a hammer to the job site and hoping for the best.
> This is an action that could have profoundly disruptive effect
If FB is doing anti-competitive things than disruption is needed. It's not meant to be comfortable.
Companies are really good at learning the playing field and then gaming it for their benefits. Tweaks to laws are often easy to work around. Disruption that stops an illegal monopoly is going to be uncomfortable. Especially at first.
But, it opens the door for the future in ways that aren't options today.
Andrew Carnegie provided far more real, unquestionable value to people too. It ended up being worth it. The same can be said for Leland Stanford or most other monopolies. They didn't become monopolies by not providing value.
> Andrew Carnegie provided far more real, unquestionable value to people too. It ended up being worth it. The same can be said for Leland Stanford or most other monopolies. They didn't become monopolies by not providing value.
Absolutely. The same could also be said of the closest parallel of Facebook in history, the Bell System.
Because move fast and brake things? Disruption good?
No, seriously, modern tech companies are an anti-trust challenge that was not truely forseen in existing anti-trust laws. That governments are now trying to find answers is a good thing.
> Laying out laws and regulations so the market works as intended (no doubt with adjustments on the way) seems like the far preferable way to ensure healthy competition...
And yet, Facebook is untrustworthy, unsafe, and had developed AI that amplifies controversy...
The Facebook purchases of WhatsApp and Instagram were not innovative and should have triggered antitrust at the time. There is no healthy competition when you buy Any worthy competitors.
It's not, because it makes them a bucket of money. Only in hindsight with an FTC in the final days of a mercurial administration do we get stuff like this.
Your answer sidesteps regulatory capture. These big companies wield massive power in Washington, don't you think any regulation and law that's actually passed will benefit them and prevent competition?
Tough. There is more at stake than FB recovering its investment into IG.
Besides... they will get to sell it, probably at a profit. They got to own it for 8 years, enjoyed the benefits of lowered competition. They will be fine. I agree that this should have been prevented in the first place, but we are where we are.
Controversially, I don't think ordinary rule of law can apply to FAANG-scale monopolies. There's no way to generalize rules, laws or industrial policies when the industry is "social media." Social media is (economically) mostly FB. Any rule, law or policy is basically regulating FB specifically.
Anyway, the danger of a hammer coming out is low. Even if prosecutors succeed, a cost-of-business fine is the most likely result. Even if they do spin out whatsapp & IG... that leaves facebook mostly intact.
I'd also note that the worst case scenario for overzealous trustbusting is basically nothing. At worst you kill FB. This isn't steel production or auto manufacturing. FB could be swallowed by a demon tomorrow and by next thursday any shortage in social media will be filled. We're not exactly short on the stuff.
FB bring in $80bn pa, but that's totally arbitrary to the cost of doing social networking. It could be done for $40bn or $8bn and I doubt the consumer would notice a difference. Again, this isn't auto manufacturing. A car company can't make as many cars with half the revenue. If one dies, we actually have less manufacturing capacity and we'll make fewer cars for a while. None of this applies to social media.
Separating IG from FB does not put anyone out of work. Nothing gets shut down. FB are extremely profitable, and that almost certainly continues
In the last paragraph, I was trying illustrate a point. With monopolies of the past, the primary concern was that the services continue to operate somehow. EG, when Bell was broken up, the danger was that phone/telegram services would be harmed. Before that, the danger was that steel production would be disrupted and downstream industries harmed.
Facebook is a monopoly in a marketplace of extreme abundance. We have lots of social media, messaging, photo sharing, etc. There is zero danger of shortages or meaningful "consumer harm," regardless of what happens to FB.
Even if antitrust does harm FB, the only stakeholders at risk are FB employees and investors. There is no systemic risk, downstream risk, consumer risk. All the risk is contained within FB.
This doesn't mean FB should be killed. It does mean that the scale tips strongly towards antitrust. On one side, we have a lot of risk. On the other, very little.
People call for putting way more than 50,000+ people out of work all of the time (eliminating the oil and gas industry as an example). If the belief is those people are engaged in harmful activity, why wouldn't you want them to stop ASAP?
> it's not really clear what the positives or negatives would be
Isn't this also true for Facebook itself as related to how dependent they are on revenue and at what cost that comes to the users who help generate it (by being presented as "eyeballs" to the advertisers)?
We used to let kids play with dry cleaning bags, until we discovered they were idiots and can suffocate on them.
The realization today is that parents were the actual idiots, not the kids.
>For instance, FB has invested massively in trust and safety people operations and AI. What happens to that investment when IG is spun off?
If what's being said is that those investments are important and necessary, then we should be looking for reasons to sustain them that aren't just about validating the continued existence of a monopoly.
>I agree and find the attempt at a breakup a bit frustrating. This is an action that could have profoundly disruptive effect and it's not really clear what the positives or negatives would be.
This organization itself is disruptive. As interesting as it is to discuss the potential costs and benefits, there's been a very real cost to society for these issues. It makes no sense to wait for further damage reports if that's at the cost of further damage. It's simple cost vs benefits really. Also I thought disruption was a good thing..?
Downvoted so I'll just add one more thing; this isn't a conversation that is new. I'm coming to this with that context. Do I want them to fail? No. The desired outcome is that they will self regulate. But if not, there should be competition. Monopolies naturally have negative side effects, that's why we try to avoid them.
Laying out laws and regulations so the market works as intended (no doubt with adjustments on the way) seems like the far preferable way to ensure healthy competition than taking a hammer to the job site and hoping for the best.