Should Facebook Be Broken Up?

Everyone knows that Facebook has acted irresponsibly with its users’ data, and people are upset. Politicians want to punish Facebook for its actions. Even Chris Hughes, the cofounder of Facebook, has advocated breaking up the company. That’s how bad things have become. But I’m not convinced Facebook should be broken up. Clearly, Facebook needs to be regulated, but breaking it up won’t solve all the problems.

The fact is that all social networks, as they exist today, are pseudo-monopolies. Facebook has managed to purchase Instagram and Whatsapp, giving it a clear dominant position in the US and many other markets. Even if you broke Facebook, Instagram and WhatsApp into three separate companies, you’d still have three pseudo-monopolies, none of which may do a better job at protecting users data and the public’s interests.

The fact is that users cannot simply switch to a new social network. They are locked in. No one wants to leave their friends behind. And without friends, a social network is useless. So competition will always be limited.

But does that make Facebook a true monopoly? Remember, there other social networks, like Snap, LinkedIn and Telegraph. Granted, none of these have the scale and reach of Facebook. Facebook is king of social networking in the US, just like WeChat dominates China, LINE in Japan, and KaKaoTalk in Korea. So what should the US government do? Can the US legally break up Facebook?

The answer is not clear. It depends on how you define a monopoly. This is uncharted territory, and a lot of it will come down to politics. It depends on who is elected in 2020. In other words, it’s more political than legal.

My personal belief is that Facebook probably isn’t a monopoly as defined under the antitrust act, and I don’t think it will be broken up. Instead, I see the government regulating Facebook. The one regulation that would end all talk of Facebook being a monopoly is a law requiring that social networks open up their APIs so that users can communicate freely between them.

Free and open communication between social networks would end the pseudo-monopoly. If anyone on Facebook could communicate with friends on other social networks and posts could be shared across networks, this would enable smaller social networks to compete on an even playing field.

I support this type of change because it will create greater competition for users and spur innovation. I also support stronger regulations on how users’ data is managed and monetized. This combination of regulations can go a long way towards fixing the problem.

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