Facebook in review
Led by New York attorney general Letitia James, this week 46 US states, plus Guam, and Washington, DC, and, separately, the Federal Trade Commission filed suits against Facebook alleging that it has maintained an illegal monopoly while simultaneously reducing privacy protections and services to boost its bottom line. The four missing states: Alabama, Georgia, South Carolina, and South Dakota.
As they say, we've had this date from the beginning.
It's seemed likely for months that legal action against Facebook was on the way. There were the we-mean-business Congressional hearings and the subsequent committee report, followed by the suit against Google the Department of Justice filed in October.
Facebook seems peculiarly deserving. It began in 2004 as a Harvard-only network, using its snob appeal to expand to the other Ivy League schools, then thousands of universities and high schools, and finally the general public. Mass market adoption grew in tandem with the post-2009 explosion of smart phones. By then, Facebook had frequently tweaked its privacy settings and repeatedly annoyed users with new privacy-invasive features in the (sadly correct) and arrogant belief they'd never leave. By 2010, Zuckerberg was claiming that "privacy is no longer a social norm", adding that were he starting then he would make everything public by default, like Twitter.
It's hard to pick Facebook's creepiest moments out of so many, but here are a few: in 2011 it began auto-recognizing user photographs, in 2012 it dallied with in-network "democracy" - a forerunner of today's unsatisfactory oversight board, and in 2014 it tested emotionally manipulating its users.
In 2011, based on the rise and fall of earlier services like CompuServe, AOL, Geocities, LiveJournal, and MySpace you can practically carbon-date people by their choice of social media - some of us wrongly surmised that perhaps Facebook had peaked. "The [online] party keeps moving" is certainly true; what was different was that Zuckerberg knew it and launched his program of aggressive and defensive acquisitions.
The 2012 $1 billion acquisition of Instagram and 2014 $19 billion purchase of WhatsApp are the heart of the suits. The lawsuits suggest that without Facebook's intervention we'd have social media successfully competing on privacy. In his summary, Matt Stoller credits this idea to Dina Srinivasan, who argued in 2019 that Facebook saw off then-dominant MySpace by presenting itself as "privacy-centered" at a time when the press was claiming that MySpace's openness made it unsafe for children. Once in pole position, Facebook began gradually pushing greater openness on its users - bait and switch, I called it in 2010.
I'm less convinced that MySpace's continued existence could have curbed Facebook's privacy invasion. In 2004, the year of Facebook's birth, Australian privacy activist Roger Clarke surveyed the earliest social networks - chiefly Plaxo - and predicted that all social networks would inevitably exploit their users. "The only logical business model is the value of consumers' data," he told me for the Independent (TXT). I think, therefore, that the privacy-destructive race to the bottom-of-the-business-model was inevitable given the US's regulatory desert. Google began heading that way soon after its 2004 IPO; by 2006 privacy advocates were already warning of its danger.
Srinivasan details Facebook's progressive privacy invasion: the cooption of millions of third parties via logins and the Like button propagandize its service to collect and leverage vast amounts of personal data while it became a vector for the unscrupulous to hack elections. This is all without considering non-US issues such as Free Basics, which has made Facebook effectively the only Internet service in parts of the world. Facebook also had Silicon Valley's venture capital ethos at its back and Facebook's share structure, which awards Zuckerberg full and permanent control.
In a useful paper on nascent competitors, Tim Wu and C. Scott Hemphill discuss how to spot anticompetitive acquisitions. As I recall, though, many - notably the ever-prescient Jeff Chester - protested the WhatsApp and Instagram acquisitions at the time; the EU only agreed because Facebook promised not to merge the user databases, and issued a €110 million fine when it realized the company lied. Last year Facebook announced it would merge the databases, which critics saw as a preemptive move to block a potential breakup. Allowing the mergers to go ahead seems less dumb, however, if you remember that it took until 2017 and Lina Khan to realize that the era of two guys in a garage up-ending entrenched monopolists was over.
The suits ask the court to find Facebook guilty under Section 2 of the Sherman Act (which is a felony) and Section 7 of the Clayton Act, block it from making further acquisitions valued at $10 million or above, and require it to divest or restructure illegally acquired companies or current Facebook assets or business lines. Restoring some competition to the Internet ecosystem in general and social media in particular seems within reach of this action - though there are many other cases that also need attention. It won't be enough to fixing the damage to democracy and privacy, but perhaps the change in attitude it represents will ensure the next Facebook doesn't become a monster.
Illustrations: Mark Zuckerberg's empty chair at last year's Grand Committee hearing.
Wendy M. Grossman is the 2013 winner of the Enigma Award. Her Web site has an extensive archive of her books, articles, and music, and an archive of earlier columns in this series. Stories about the border wars between cyberspace and real life are posted occasionally during the week at the net.wars Pinboard - or follow on Twitter.