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F.T.C. Decision on Pursuing Facebook Antitrust Case Is Said to Be Near


WASHINGTON — The Federal Trade Commission is moving closer to a decision about filing an antitrust lawsuit against Facebook for its market power in social networking, according to two people with knowledge of the agency’s talks.

The five members of the F.T.C. met on Thursday to discuss its investigation into Facebook and whether the company had bought smaller rivals to maintain a monopoly, the people said. They said three documents about Facebook had been prepared by the agency and circulated among its leaders: One addresses the company’s potential antitrust violations, another analyzes its economics, and a third assesses the risks of litigation.

No decision on a case has been made, the people said. The commissioners must vote before any case is pursued.

Facebook and the F.T.C. declined to comment. The Washington Post reported earlier that the commission met about the Facebook investigation on Thursday.

Lawmakers and policymakers in Washington have ramped up antitrust actions against the largest technology companies, often in a bipartisan effort. On Tuesday, the Justice Department sued Google, accusing it of illegally maintaining its monopoly power in search and search advertising — the first such government action against a tech company in two decades. Two weeks ago, the House Judiciary Committee recommended taking action to break up the big tech platforms, including Facebook, Amazon, Apple and Google.

The actions reflect growing frustration toward the companies, which total around $5 trillion in value and have transformed commerce, speech, media and advertising globally. That power has drawn the scrutiny of conservatives like President Trump and liberals like Senator Elizabeth Warren of Massachusetts.

The U.S. investigations began last year when the Justice Department started examining Google and other tech companies. Joseph Simons, the chairman of the F.T.C. and a Trump appointee, also opened an investigation into Facebook in June 2019. Around the same time, four dozen state attorneys general began a parallel investigation into the social network.

Facebook has tangled with the F.T.C. before, but mainly over privacy issues. The company reached a privacy settlement in 2011 with the agency. In 2018, the F.T.C. opened an investigation into Facebook for violating that settlement, prompted by a report from The New York Times and The Observer of London on how the company allowed Cambridge Analytica, a British consulting firm to the Trump campaign, to harvest the personal information of its users. As a result, Facebook last year agreed to a record $5 billion settlement with the F.T.C. on data privacy violations.

The antitrust investigation by the F.T.C. has been far-reaching. The agency has collected thousands of internal documents from Facebook’s leaders. It has also interviewed people from the company’s rivals, such as Snap, which owns the Snapchat app, about Facebook’s dominant position in social networking and its business practices.

In August, Mark Zuckerberg, Facebook’s chief executive, answered questions under oath as part of the inquiry.

The company has denied violations of antitrust laws. It points to competition in online social networks, including the fast rise of the Chinese-owned viral video app TikTok, as proof that it does not have a lock on the market.

But with nearly three billion users across its apps and a market value of $792 billion, Facebook is unrivaled in size among social networking apps. Part of its dominance has been due to acquisitions of smaller rivals. Facebook bought the photo-sharing app Instagram for $1 billion in 2012. It bought WhatsApp, the messaging app, for $19 billion in 2014. Both mergers were approved by the F.T.C.

The commission’s investigation has largely focused on Facebook’s mergers with companies like Instagram and WhatsApp, people with knowledge of the inquiry said. The deals remove competition from the market and have bolstered Facebook’s reach and clout, its critics have said.

In a July antitrust hearing with House lawmakers, Mr. Zuckerberg was confronted with emails showing that a Facebook executive had referred to Instagram during the acquisition process as a “competitive threat.” Mr. Zuckerberg said Instagram’s success was due to Facebook.

But his answer did not appear to satisfy House lawmakers.

In an antitrust report this month, staff of the House Judiciary Committee said Facebook’s power in social networking was so immense that the company “has tipped the market toward monopoly such that Facebook competes more vigorously among its own products — Facebook, Instagram, WhatsApp and Messenger — than with actual competitors.”