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Photo: AP
Photo: AP

Opinion | The monopoly power that Facebook wields

Mark Zuckerberg’s defence against charges of dominance may have held good under old norms of competition, but was flimsy in the context of how power is exercised in this era

Ever since Thomas Paine’s 1776 Common Sense effaced America’s eternal allegiance to a single man, one with a crown playing halo, the US has held the idea of a monopoly in governance to be the antithesis of liberty. It has fought for this cause even overseas, at least on paper, as it did against Soviet autocracy in the Cold War. It has long viewed oligarchs as villains. Today, even as the US economy suffers its worst quarterly crash on record, with a third of last April-June’s output wiped out by covid spasms in the second quarter of 2020, US lawmakers are mulling intervention against a brisk accumulation of wealth and clout by its Big Tech companies. Last week, a panel of legislators asked the chiefs of Facebook, Amazon, Apple and Alphabet, Google’s parent, to respond to charges of their being “gatekeepers" to the digital economy. This was hours before the four reported robust earnings amid all the gloom. Given Facebook’s social media heft, the spotlight was on its boss Mark Zuckerberg, a veteran of such hearings. He was grilled last year over Libra, his e-currency project, and hauled up over a “data leak" in 2018. This time, he seemed to acquit his company rather easily, though only under US anti-monopoly rules of the industrial era. If these get updated to the information age, as they should, Facebook could be back in the dock.

In defence of his social media empire, Zuckerberg resorted to an old trope, arguing that it did not dominate usage markets, nor did it overcharge users. In the US, he said, Facebook got less than a tenth of every advertising dollar, had a rival in Apple’s iMessage that carried more messages, and had turned WhatsApp into a free chat service after acquiring it in 2014. An internal 2012 email that spoke of a need to “neutralize" Instagram, which he bought soon after, was dismissed as benign. Also, he argued, technology was not a field given to dominance: “History shows that if we don’t keep innovating, someone will replace every company here today." The innovative part of the deposition was his attempt to present Facebook as a champion of America’s tech war with China. The fastest-growing app in the US was TikTok, he said, and of the globe’s top 10 tech firms, many were now Chinese. So there was no guarantee that the web would stay free and open, or that US values would win.

Dominance of the internet, however, is best judged neither by market share nor usage charges, but by the authority that apps wield over users. While Apple and Alphabet may have control of our interface with mobile phones, Facebook’s platforms have an edge in keeping our eyeballs riveted. Thanks to our need for common space and its network effects, WhatsApp has grown into an essential utility with captive users. It can pitch us anything, be it a payment tool or an e-currency. Moreover, our attention is not all it has, but also vast volumes of our personal data, a highly valuable resource that could be abused even for politics, as the Cambridge Analytica scandal showed. It may be true that any move to hobble it could work to China’s advantage. Yet, on the evidence so far, Facebook can hardly project itself as an online warrior for a free world. All in all, if a monopoly in the arena of politics is a threat to liberty, so too in the domain of business. Will the US uphold or let this principle down? The stakes seem high for everyone.

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