The Federal Trade Commission reported that it is exercising its right to perform a competition probe on the social media juggernaut Facebook, Inc. (NASDAQ:FB). This update was taken negatively by the market, dragging down the company’s stock deep in the red. Social media firms have been facing an increasing backlash and mark another measure by the Trump administration to fix the line on the leading social media and tech companies. It is a well-known thing that Trump administration has repetitively accused social media firms of overturning conservative voices online.
The latest development comes on the back of the case that has the U.S. Justice Department looking into Alphabet Inc (NASDAQ: GOOGL) with a similar probe. The Justice Department may investigate Google to ascertain whether the technology firm breached regulations that ensure fair competition. This news impacted the stock price of Alphabet adversely, recording the biggest decline outside fiscal earnings since 2011. Elsewhere, the FTC will dig into the inner workings of Amazon.com, Inc. (NASDAQ: AMZN), while the Justice Department will investigate Google on the same matter.
With jurisdiction divided, the upcoming step is for these federal agencies to ascertain if they intend to initiate formal investigations. It may take some time for the results to come considering an earlier probe of Google by FTC took almost two years to conclude.
Last month, Chris Hughes stated that Facebook CEO had exceptional power and mentioned that U.S. regulators should take action.
Technology firms face criticism in the U.S. and across the world, driven by fears among lawmakers, consumer groups, and competitors that the companies have unprecedented power and are harming business rivals and users.
Considering the concerns of consumers, competitors and lawmakers, the U.S. government is preparing to probe whether Amazon, Google, Apple, and Facebook misuse their unmatched market power. This step could result in an unparalleled, wide-ranging investigation of some of the world’s major companies.