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Facebook Businesses EU Social Networks The Internet

European Lawmakers Asked Mark Zuckerberg Why They Shouldn't Break Up Facebook (theverge.com) 220

European lawmakers questioned Mark Zuckerberg in Brussels today for almost an hour and a half, asking him to address concerns about the Cambridge Analytica data leak and Facebook's potential monopoly. German MEP Manfred Weber asked whether the Facebook CEO could name a single European alternative to his "empire," which includes apps like WhatsApp and Instagram in addition to Facebook. "I think it's time to discuss breaking up Facebook's monopoly, because it's already too much power in only one hand," said Weber. "So I ask you simple, and that is my final question: can you convince me not to do so?" Belgian MEP Guy Verhofstadt then chimed in and asked whether Facebook would cooperate with European antitrust authorities to determine whether the company was indeed a monopoly, and if it was, whether Facebook would accept splitting off WhatsApp or Messenger to remedy the problem. The Verge reports: The panel's format let Zuckerberg selectively reply to questions at the end of the session, and he didn't address Verhofstadt's points. Instead, he broadly outlined how Facebook views "competition" in various spaces. "We exist in a very competitive space where people use a lot of different tools for communication," said Zuckerberg. "From where I sit, it feels like there are new competitors coming up every day" in the messaging and social networking space. He also said that Facebook didn't hold an advertising monopoly because it only controlled 6 percent of the global advertising market. (It's worth noting: this is still a huge number.) And he argued that Facebook promoted competition by making it easier for small businesses to reach larger audiences -- which is basically unrelated to the question of whether Facebook itself is a monopoly.
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European Lawmakers Asked Mark Zuckerberg Why They Shouldn't Break Up Facebook

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  • by Anonymous Coward

    Europe should ban Facebook completely. Block all their servers until Zuck takes this seriously.

    • "Europe" isn't a single country with a unified Internet access policy, it would be hard to do.
  • by b0s0z0ku ( 752509 ) on Tuesday May 22, 2018 @06:49PM (#56656020)
    Watching Zuck squirm is good fun. May the trend continue.
  • by Anonymous Coward

    German MEP Manfred Weber asked whether the Facebook CEO could name a single European alternative to his "empire,"

    So you're a monopoly if no Europeans can compete with you?
    This is a weird idea, that only domestic companies count as competitors.

  • Blunt (Score:4, Insightful)

    by Tablizer ( 95088 ) on Tuesday May 22, 2018 @06:54PM (#56656038) Journal

    A blunt/honest answer would be: "Because many of your citizens would think you are regulatory douche-bags for cutting them off from a popular global service, and you'll lose elections."

    I'm not saying I necessarily agree with such citizens, only that such a move could create political backlash for those asking the question.

    • by rtb61 ( 674572 )

      The public wont be shut down, they will just be product shifted. Can't break up Facebook, no problem, ban it and kill it, choose and perish. Facebook fad audience will just shift from hula hoops to yoyos, loyaltity Facebook executives do not have it, not even the scent of it, right now, governments could coat the executives of facebook with gravy and toss them to the wolven mob and they would just tear them to pieces, they are already baying for blood, don't even try calling to them and attracting their att

    • A blunt/honest answer would be: "Because many of your citizens would think you are regulatory douche-bags for cutting them off from a popular global service, and you'll lose elections."

      Stupid answer. Breaking up Facebook changes nothing for the citizens. No one would get cut off from anything if Facebook's is broken up into individual businesses,... you know like the individual businesses they were before Facebook bought them.

      A better question would be: Since when does an empire of diverse products constitute a monopoly. And then proceed to rattle off the many alternatives to WhatsApp, Instagram, Facebook, and the B2B side of the company that users could freely migrate to if they so wish

      • When you can scarcely fart on the Internet without one, single company hearing about it in 3 different ways, then that company looks like a monopoly.

        Facebook fits the bill, and so does Google - although right now, they're focussing on Facebook because they were stupid enough to lose some of the data they collected. If Google has a breach, they'll be in the same firing line (and probably more besides).

        You don't have to be the only player in a market to look like a monopoly. The fact that everyone "could" swi

        • When you can scarcely fart on the Internet without one, single company hearing about it in 3 different ways, then that company looks like a monopoly.

          Yes I'm sure it would if you have no idea what the word monopoly means or how anti-trust laws relate to it.

    • Literally no-one is losing any votes by going after Facebook. Its addicts would have to put the phone down to vote.

  • by WindBourne ( 631190 ) on Tuesday May 22, 2018 @06:55PM (#56656040) Journal
    Seriously, they need to create 4-6 new companies from Google, Facebook, and possibly others. Then have them focus initially on single continent (ideally with employees located there, but, they can be split). After 1-2 years, allow them to compete where ever.
    With this approach, each company is more responsive to the local nations, but also allows them the chance to better integrate with those nations before taking on each other.
    • Re: (Score:2, Interesting)

      by Anonymous Coward

      The problem with that, is you're asking large teams to replicate their entire workflow and apparatus, largely knowing what continent they as employees and owners are going to be on when it's all over.

      You're basically asking them all to sabotage eachother in their own creation.

      Yeah, I know ISO certification, everything should be documented and all that - but like with legally complying with a court request - there's still a LOT of room even in ideal scenarios for games to be played with a multi-year window

    • by aaarrrgggh ( 9205 ) on Tuesday May 22, 2018 @08:48PM (#56656452)

      The situation we are in is because of natural network effects-- there are few "natural" vertical boundaries, and geography isn't one of them. Serving the local population is something they are already (theoretically) invested in, as they want to be able to advertise to them.

      Facebook should have never been permitted to buy Instagram or Whatsapp (at a minimum). These are the natural vertical boundaries; people don't associate facebook and instagram as closely as they do their friends/family/kin in another country.

    • That would be a fantastic way of preventing Americans from benefiting with the GDPR requirements that Facebook must follow.

  • by viperidaenz ( 2515578 ) on Tuesday May 22, 2018 @06:58PM (#56656054)

    "From where I sit, it feels like there are new competitors coming up every day and we use our monopoly crush them all the time"

    • Or, alternate ending would be:

      "From where I sit, it feels like there are new competitors coming up every day, and we buy them up before they can become a serious threat"

      • by El Cubano ( 631386 ) on Tuesday May 22, 2018 @09:34PM (#56656620)

        "From where I sit, it feels like there are new competitors coming up every day, and we buy them up before they can become a serious threat"

        You do understand that getting acquired is one of the most popular exit strategies for venture funded start ups, right? It is usually either that or go public and there is lots more paperwork to go public. So, the startup founders go around telling investors that their product would be a natural fit for (pick your favorite megacorp). Then, how do you get (pick your favorite megacorp) to acquire your start up? You appear to them like competition or some sort of threat to their marketshare, because knocking on the front door and asking nicely will not even get you the time of day.

        So, while companies like Google and Facebook buying up potential competitors might seem purely evil from one perspective, there is no shortage of start ups throwing themselves at the big companies to get bought. The venture capitalists get their huge returns, the founders make a mint and then either VP jobs at the big company or walk away with bagfuls of cash and start another company, or retire, or whatever.

        • "From where I sit, it feels like there are new competitors coming up every day, and we buy them up before they can become a serious threat"

          You do understand that getting acquired is one of the most popular exit strategies for venture funded start ups, right?

          So, if I understand you correctly, you are agreeing with GP's premise that Facebook is eliminating competition?

          To be sure, you are saying that the competition is happy to be eliminated, but that's not the point. Otherwise, whenever some evil villain did

          • So, if I understand you correctly, you are agreeing with GP's premise that Facebook is eliminating competition?

            To be sure, you are saying that the competition is happy to be eliminated, but that's not the point.

            I think you misunderstand. While there are certainly some companies out there that present legitimate competition to Facebook and others, not all of them do. In fact, though I do not have data to back it up, I have talked with enough people on the startup scene that I get the sense that very few startups intend to compete directly with Facebook and others. Their objective from the early on is to fille a niche that is ignored by the big guys or to get acquired. If not for the possibility of getting acquired

          • To be sure, you are saying that the competition is happy to be eliminated,

            No, the competition wouldn't exist if not for the opportunity to be eliminated, making a profit in the process.

        • That's their problem. The EU has no reason to give a fuck about Silicon Valley kids and their exit strategies.

  • Shares its collection of social media with NATO so everything is all legal and good in the EU?
  • by superposed ( 308216 ) on Tuesday May 22, 2018 @07:20PM (#56656158)

    This problem is more complex than it looks. If they split Facebook, WhatsApp and Instagram apart from each other, it may help with privacy and user choice a little. There may be less trading of information between affiliates and/or less requirement to sign up with one service to make use of another. But each of these companies will still be quasi-monopolies in their respective areas. The same goes for Google.

    This may be inevitable -- anytime there are economies of scale in a market, you can get a natural monopoly, where no one can afford to compete with the incumbent firm(s). It cost a lot of money to build Google's search database Facebook's user network. It's nearly impossible for anyone else to come into those niches and compete with them. And do you even really want them too? How many people just use Google because it's good enough (extremely good really, compared to what came before), or Facebook because that's where their friends are?

    The traditional answer to natural monopolies is regulation or government ownership. Regulation consists of the "utility compact" -- give the company a guaranteed monopoly, but regulate the prices they charge and the type of service they provide (e.g., require universal access). That's a no-brainer when dealing with essential services -- landline phones, electricity, water, bus service, and maybe Internet access (I would argue that this was the issue at the heart of network neutrality -- are ISPs common carriers or optional products?).

    But does the idea of natural monopoly apply to "non-essential" services like Facebook and Google? Or maybe the cost of these services is just so low that we can ignore the inefficiency of having multiple providers in favor of innovation (e.g., people can signup for both WhatsApp and Skype, so what's the problem)? My instinct is that big tech companies may be edging into a gray area. Clearly people have alternatives to these companies, but on the other hand, due to their incumbent status, these companies have a huge advantage and are de facto the default provider for these services, a position they can abuse. We don't regulate electric utilities because they would cutoff service if we didn't; we regulate them so they can't abuse their dominant position. Should the same apply to big tech? I'd lean toward "probably not" at this point, but it's interesting to think about.

    • Sorry, should have said "increasing returns to scale [wikipedia.org]" instead of "economies of scale." But the basic idea is, it's very hard and may not even be a good idea to build a new (phone, electricity, water, social?) network once an incumbent has already done it.

    • Re: (Score:2, Interesting)

      by AmiMoJo ( 196126 )

      Interoperability might be the solution. If different platforms can talk to each other there is less lock-in.

      Even just being able to migrate all your stuff from service to service would help.

      Of course we also need that to respect privacy.

    • by Anonymous Coward on Tuesday May 22, 2018 @08:12PM (#56656318)

      If we do regular these "non-essential" services, how do we do that if breaking up is not the answer? An idea: we could force open standards over the internal API, effectively turning some tech giants into utilities.

      For example, everyone could add themselves to the social network without FB's software (maybe with a different software). Everyone could create an API provider, extending the social network, but not necessarily using FB's software. We could keep moderation with FB for now. FB keeps running its network as a base for the actual social network, but with limited control over the service itself.

      This deals with the anti-competitive aspects of FB in a similar way to what we do with some natural monopolies, where a monopoly runs the basic service (rail tracks, electricity wires), but there's still some competition over the service itself. This does not entirely deal with the data issues - perhaps later, we can take this standard and migrate to a distributed version, and than these would be ameliorated as well.

      • by tsa ( 15680 )

        This. I think it's not only the simplest way to level the playing field and give the user control over what software she uses, but also the only viable one.

    • by Dog-Cow ( 21281 )

      Breaking off WhatsApp and Instagram will either kill those products, or lead to them funneling all their data to FB in exchange for cash to continue operating. Effectively, FB will still own WhatsApp and Instagram, except on paper. It's a stupid idea, because it has no real effect.

  • Now he is merely negotiating their price.

  • by OrangeTide ( 124937 ) on Tuesday May 22, 2018 @07:35PM (#56656220) Homepage Journal

    If EU wanted alternatives maybe they should ask Google why they killed Orkut. (created by a Turkish national)

    There is also ASW, which is for the elites of European society. (and based in Switzerland I believe)

    And there is also Netlog (aka Facebox) which is Belgian and still around. Certainly not as hugely popular as Facebook (like 0.5% the user base)

    It's a bit ridiculous to expect "competition" in a market where the service is totally free (except for ASW). I'd argue that facebook users aren't really engaging in a commercial transactions.

    What it really it really is is up to regulators, but thinking that it is a business or a monopoly is a mistake. I can start a social network site tonight, and Facebook can't stop me and isn't (as far as I know) going to keep users from my site. Google will probably happily index me in their search engine if it means I dilute Facebook's market share.

    • by AmiMoJo ( 196126 )

      The issue is that if you don't like Facebook it's not like you can just go to another social network. Without your friends it won't be much fun.

      There is some competition, but it either gets bought by Facebook anyway or is niche like LinkedIn.

      The usual solution is to require Facebook to open up. You can have your Tumblr posts appear on your Facebook wall, along side your tweets.

    • Google killed Orkut because the Brazilians made it unusable by anyone else. I got multiple unwanted contact requests (all from people whose language I don't speak) per day, and nothing else. They wanted an international social networking site, and got a Brazilian one.

      • The issue was less critical for me as I'm (slowly) learning Portuguese. My pronunciation is atrocious though.

        "international" is code for anglophone. it's OK, I don't think that's really that bad. But let's at least be honest about it.

        • "international" is code for anglophone. it's OK, I don't think that's really that bad. But let's at least be honest about it.

          It wasn't international, though. It really was just Brazilians. I wasn't getting dozens of unsolicited contact requests from Chinese, or Australians, or people on the African continent. It was literally 100% Brazilian.

          • Orkut wasn't initially so Brazilian. And if it were all Americans I doubt people would complain about it not being international. Well at least the Americans wouldn't complain.

            • Orkut wasn't initially so Brazilian. And if it were all Americans I doubt people would complain about it not being international. Well at least the Americans wouldn't complain.

              You can make whatever you want out of it (and you're probably right about that last part) but my only point was that they didn't get what they wanted, so they shut it down. And I happen to see what it turned into, and I think it's a shame they didn't keep it going, even though I didn't use it. But... that's how they are. They shut things down all the time.

  • by manu0601 ( 2221348 ) on Tuesday May 22, 2018 @07:36PM (#56656230)

    I quite dislike Facebook, and but I fail to see how breaking up Whatsapp and Messenger from Facebook would remedy anything exposed in the Cambridge Analytica affair.

    • Re:For what goal? (Score:4, Interesting)

      by aaarrrgggh ( 9205 ) on Tuesday May 22, 2018 @08:53PM (#56656466)

      It is much more difficult to regulate the conglomerate than the subsidiaries, if the time comes. You simply get to a point that they can say "this is the way it works," and there isn't really much you can do. The incentive to break them up is in keeping them from being too ingrained that you cannot kill them.

      • by Dog-Cow ( 21281 )

        The messaging apps and services of FB don't generate any income. They are worthwhile to FB because they funnel ever-more data about users that can be used to target advertising everywhere else. If the proposed subsidiaries are banned from selling the same data they ship to FB HQ today, they will die. There's no money in messaging apps. If they aren't banned, you've added paperwork, but have essentially changed nothing from the perspective of users or other EU citizens.

        • If they aren't banned, you've added paperwork, but have essentially changed nothing from the perspective of users or other EU citizens

          Wait, you would have hurt Facebook, at least. It does not fix anything, but that is not so bad!

  • Break up the Facebook empire? That's not going far enough. Burn the whole gods-be-damned thing to the ground. Set off an EM pulse bomb in every single datacenter Facebook uses, to fry every single server and wipe every single hard drive. Then nobody will have to worry about their data falling into the wrong hands again (at least not because of Facebook). Then: Google, you're next.
  • by schwit1 ( 797399 ) on Tuesday May 22, 2018 @08:25PM (#56656348)

    https://www.economist.com/grap... [economist.com]

    MAY 20th will mark the end of “mental-health awareness week”, a campaign run by the Mental Health Foundation, a British charity. Roughly a quarter of British adults have been diagnosed at some point with a psychiatric disorder, costing the economy an estimated 4.5% of GDP per year. Such illnesses have many causes, but a growing body of research demonstrates that in young people they are linked with heavy consumption of social media.

    According to a survey in 2017 [rsph.org.uk] by the Royal Society for Public Health, Britons aged 14-24 believe that Facebook, Instagram, Snapchat and Twitter have detrimental effects on their wellbeing. On average, they reported that these social networks gave them extra scope for self-expression and community-building. But they also said that the platforms exacerbated anxiety and depression, deprived them of sleep, exposed them to bullying and created worries about their body image and “FOMO” (“fear of missing out”). Academic studies have found that these problems tend to be particularly severe among frequent users.

    What would be the public and government response be if these same symptoms were caused by something in our drinking water or in the air or in food?

    • Not at all. Social Networking should be declared a mental health hazard. What you're doing is akin to saying that banning 9mm bullets will fix gun crime in America.

  • > "From where I sit, it feels like there are new competitors coming up every day"

    This could actually be true, but only for a few seconds until Zuckerberg smacks each little start-up into oblivion from his high castle using a team of elite lawyers.

    His whole job probably feels like one giant game of whack-a-mole.

    • Lawyers? I suppose, maybe. Seems far more likely he'll just crush them with Monopoly power (normal) or buy them (if they protected their IP/he wants to acqui-hire.)

      • by JustNiz ( 692889 )

        > Lawyers? I suppose, maybe. Seems far more likely he'll just crush them with Monopoly power

        Isn't that the same thing?

  • Because THEY'RE NOT UNDER THEIR JURISDICTION!!! THEY'RE AN AMERICAN...oh wait, didn't they move to Ireland as a tax dodge? Ooh, that one really came back to burn then didn't it?
  • by sound+vision ( 884283 ) on Wednesday May 23, 2018 @12:40AM (#56657108) Journal
    And he argued that Facebook promoted competition by making it easier for small businesses to reach larger audiences -- which is basically unrelated to the question of whether Facebook itself is a monopoly.

    And it's also totally false... the internet is what lets small businesses reach a larger audience. As much as Facebook would like to make The Internet a wholly owned subsidiary, that's still not the case in... most places, I think some African or Asian villages might only have Facebook Essentials....
  • by thegarbz ( 1787294 ) on Wednesday May 23, 2018 @03:15AM (#56657440)

    Since when does an empire have a monopoly on account of being an "empire". Are people using the Facebook empire? The way I see it Facebook is made up of a variety of platforms and except for the social media platform itself each of them have healthy competition on the continent. If the Belgian MEP wants to know what the alternatives are, why doesn't he ask his daughter who likely uses none of Facebook's "empire".

    Mind you the entire question sounds like it was dreamed up in a coffee shop in Amsterdam. What would breaking up achieve? WhatsApp and Instagram were massively popular pre-Facebook. Ownership didn't change anything there, and breaking Facebook's social network out from the rest achieves nothing regards to Facebook's market power, nor does it prevent any of the things that various governments are questioning the Zuck about.

  • At last, at last, the European Parliament is in the news.
    At last, at last, elected MEPs are named in the news.
    At last, at last, the words of elected MEPs are quoted in the news.

    I am in tears typing this. I am in Hazlemere, in Buckinghamshire, UK. Why has it taken so long?

    For so long, the news media in the UK has behaved as if there is no such thing as the European Parliament. Newspaper after newspaper has been printed without mentioning a single word said in the European Parliament. Or any of the other 6 in

    • That is because the moguls that control the UK media want it that way and why they've spent two decades lying every day about the EU.

  • that many of these people are so against any PRIVATE business having a "monopoly" because the competition didn't do as well, but would have no issue with a government-run "monopoly" doing the same thing.

    • I don't understand why that's strange. I trust a government monopoly far more than a private one. I based that on the history of utilities.

      Why shouldn't I?

  • "I think it's time to discuss breaking up Facebook's monopoly, because it's already too much power in only one hand," said Weber. "So I ask you simple, and that is my final question: can you convince me not to do so?"

    Zukerberg sighed, knowing the "convincing" the politician needed involved his hand behind his back, fingers wagging. This was why these people went into power, to get in the way, to be paid to get back out of the way.

    For now he would play the contrition game. Many were the useless idiots who

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