Facebook to face antitrust inquiry by state attorneys general

More than 30 state attorneys general are preparing a separate inquiry into Google for potential antitrust violations.

    Facebook's shares were down two percent in early trading on Friday [File: Dado Ruvic/Reuters]
    Facebook's shares were down two percent in early trading on Friday [File: Dado Ruvic/Reuters]

    Several state attorneys general in the United States will investigate Facebook to determine whether the social media network stifled competition and put users at risk, days after reports that Google would face an antitrust investigation from a host of attorneys general.

    "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," New York State Attorney General Letitia James, who is leading the inquiry, said on Twitter. 

    Attorneys general investigating the company also include those of Colorado, Florida, Iowa, Nebraska, North Carolina, Ohio, Tennessee and the District of Columbia, a statement said.

    The New York attorney general's office said it expected more states to join the investigation.

    "People have multiple choices for every one of the services we provide," said Will Castleberry, Facebook's vice president of state and local policy. "We understand that if we stop innovating, people can easily leave our platform ...This underscores the competition we face, not only in the United States but around the globe." 

    Castleberry added that the company would work constructively with state attorneys general.

    The company's shares were down two percent in early trading.

    Reuters news agency and other media outlets reported on Tuesday that more than 30 US state attorneys general, led by Texas, were readying an investigation into Alphabet Inc's Google for potential antitrust violations, to be announced on September 9.

    The investigation into Google is focused on the intersection of privacy and antitrust, a source told Reuters.

    Google has said that it was cooperating with the state officials.

    Growing pressure on big tech

    Technology companies are facing a backlash in the US and across the world, stoked by concerns among competitors, legislators and consumer groups that the firms have too much power and are harming users and business rivals.

    US President Donald Trump has also called for closer scrutiny of social media firms and Google, accusing them of suppressing conservative voices online, without presenting any evidence.

    In July, the US Department of Justice said it was opening a broad investigation of major digital technology firms, focusing on whether they engage in anticompetitive practices.

    The investigation is believed to target Google, Amazon and Facebook, and potentially Apple.

    Separately, the US Federal Trade Commission, which also enforces antitrust laws, is also probing Amazon and Facebook to determine whether they abused their tremendous market power in retail and social media, respectively.

    Amazon, the world's biggest online retailer, has been criticised for holding sway on its website over third-party sellers, who must pay for advertising to compete against first-party and private label sales by Amazon itself.

    Legislators have also argued that Amazon's low prices have hurt brick-and-mortar retailers, many of whom have closed because they could not compete.

    SOURCE: Reuters news agency