US states launch antitrust probes targeting Facebook and Google

US states launch antitrust probes targeting Facebook and Google
Legal

US states attorney generals announced two new antitrust probes on Friday, aimed at large tech companies such as Facebook and Google, according to Reuters

One probe, investigating Facebook, will be led by New York and includes seven other states as well as the District of Columbia. A second probe is expected to be aimed at Google, led by Texas and including 40 other states.

In recent years, tech companies have faced fresh scrutiny from regulators, politicians, and the public on both sides of the Atlantic, over privacy lapses, their handling of user data, and their dominance over their markets. In Europe, it has already led to investigations into anticompetitive practices, as well as large fines under the landmark General Data Protection Regulation (GDPR), which sets strict limits on the collection and processing of user data.

In the US, regulators haven’t always kept up with the public’s shifting sentiment toward tech companies. While Facebook did pay a $5 billion settlement over the Cambridge Analytica scandal, in which 87 million users had their data shared with a political consulting firm, critics argued it had little impact on the company.

On Friday, New York Attorney General Letitia James tweeted:

“I’m launching an investigation into Facebook to determine whether their actions endangered consumer data, reduced the quality of consumers’ choices or increased the price of advertising. The largest social media platform in the world must follow the law.”

That probe will also include Florida, Colorado, Iowa, Nebraska, North Carolina, Ohio, Tennessee, and Washington DC. 

Another new probe, led by Texas Attorney General Ken Paxton, will also investigate large tech companies. Sources told Reuters that it’s expected to focus on Google, and that it will examine areas where antitrust and privacy issues overlap. It will include over 40 states.

Federal authorities like the Justice Department and the Federal Trade Commission are also investigating Facebook, Apple, Amazon, and Google for antitrust violations. 

Regulators are focused on whether the companies have used their dominance of the market to suppress competition. Billions of people use Facebook and Google, giving them access to personal data that can be used to target digital ads. Google accounts for 37 percent of the digital ad market share in the US, while Facebook accounts for over 20 percent.  

The move by the states suggests that scrutiny of tech companies in the US may be catching up to Europe, where Facebook is already facing an antitrust investigation and the possibility of further sanctions for violations of privacy law. In the UK, a parliamentary report this year found that the company had broken privacy and competition laws, and called its executives “digital gangsters.”

Photo by The Pancake of Heaven! [CC BY-SA 4.0 (https://creativecommons.org/licenses/by-sa/4.0)]

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