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As it became known that FTC is preparing a potential injunction against Facebook, the company’s stock dropped. However, after the news on U.S.-China deal Facebook stock started gaining.
The U.S. Federal Trade Commission (FTC) said on Thursday it is considering the possibility to seek a preliminary injunction against social network Facebook Inc., claiming it is acting anticompetitive by integrating other social apps in its network.
Besides its social network, the tech giant owns Instagram, Messenger and WhatsApp and this injunction wants to ban Facebook from further integrating new applications.
According to a Wall Street Journal, in a situation where this would become an antitrust matter, the federal regulators could enforce the company to split. However, officials are concerned that with further integration of new apps, breaking the company would be harder.
At the time of writing, the Facebook stock was rising 0.53% to $197.80 in premarket trading. However, yesterday the market closed with facebook losing 2.72% and trading at $196.75.
We already wrote of how the last few years of this decade have been harsh for this company. Last year, we had genocide in Myanmar, lynchings in India and a fake news tsunami in Brazil. Then came Cambridge Analytica, an exodus of executives, regulators that never sleep, stagnating growth and a falling stock price. Of course let’s not forget the trip to Congress, jabbering about Alex Jones, the really weird defense of Holocaust denial, a starring role in an indictment of Russians, and more.
Splitting Facebook up was seen as a rescue haven by some analysts (and regulators for that matter) since the Cambridge Analytica. They claim that with letting platforms such as Instagram function as separate operating companies, it might help each unit maximize its individual growth prospects.
Facebook, on the other hand, says that America ‘au contraire’ needs larger tech giants to remain competitive against ever-growing rivals such as TikTok.
However, let’s not forget that Facebook’s CEO Mark Zuckerberg recently had quite an interesting “dinner” with the U.S. President Donald Trump staying in “close touch” afterward. On the other hand, Facebook’s employees keep donating heavily to various Democratic nominees looking to defeat Trump.
Be it as it may, today’s news is all about Trump signing off tariffs that should have been imposed on China on December 15. And not just that, but he will probably cut in half the existing ones. When you take that into consideration, it is normal that even Facebook stock will gain growth. However, we then come back to the TikTok question that’s been ravishing Zuckerberg so bad. It is the political tensions that recently even made several TikTok employees and advisers to question the company’s senior management about possible ways to distance the app from its Chinese roots, including expanding operations in Southeast Asia and rebranding the app in the U.S.
Zuckerberg could actually look at TikTok as a potential helper for strengthening his position in the U.S. and the rest of the world (except for China of course). He might even ask some senators that were so eager to grill him in October this year. Senator Josh Hawley said last month that:
“TikTok claims they don’t store American user data in China. That’s nice. But all it takes is one knock on the door of their parent company, based in China, from a Communist Party official for that data to be transferred to the Chinese government’s hands, whenever they need it.”
After he didn’t succeed in acquiring the Shanghai-based lip-syncing app Musical.ly back in 2016, losing to ByteDance in 2017, he might turn the opposite, all American way – fighting for his nation’s rights and earning some more money as well – in the real tradition of his people.