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BREAKING - @Facebook faces breakup demand by Federal Trade Commission

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  • dburnedburne Posts: 4,426 Valuable Player
    I think many probably saw that coming...
    Don

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  • OmegaM4NOmegaM4N Posts: 1,146
    Wintermute
    edited December 2020
    "Oh, that came as a surprise", no on was ever heard saying. lol
  • snowdogsnowdog Posts: 8,116 Valuable Player
    And a thread on Reddit says it's possibly a huge win for VR. Not sure how they're working that out lol :D
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  • TomCgcmfcTomCgcmfc Posts: 3,363 Valuable Player
    edited December 2020
    snowdog said:
    And a thread on Reddit says it's possibly a huge win for VR. Not sure how they're working that out lol :D
    Ya, like those reddit FB-hating kiddies who think that selling FB's VR division to Valve, Vive, Sony, or Microsoft is going to improve things, lol!  Lucky P. might offer to buy it back for $0.10 per $ valued?

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  • ZenbaneZenbane Posts: 16,879 Valuable Player
    It was the FTC who gave approval to Facebook to purchase Instagram and WhatsApp in the first place.

    There are pro's and con's to both sides of this equation. For me, I'm just looking forward to watching this drama play out over the next year. Gives me something to do while I wait for some pandemic vaccines lol
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  • DaftnDirectDaftnDirect Posts: 6,490 Volunteer Moderator
    edited December 2020
    I think anyone cheering for the sale of Oculus may be disapointed. Looks like the filing concentrates on the WhatsApp and Instagram acquisitions, based on the assumption that those two purchases happened because they were direct competitors to Facebook's messenger, in other words, buy or bury was the thinking.

    The Oculus purchase was different, Facebook didn't have a VR division that was threatened and it would be tough to argue Facebook have stifled competition in the industry with that purchase, with new headsets coming to market from other manufacturers. If Facebook bought out Valve, that would be different.
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  • kevinw729kevinw729 Posts: 5,907 Valuable Player

    As we stated at the beginning of the year - this is very much a repeat of the "Standard Oil" situation from American business history regarding monopolistic behaviour by big businesses.

    It is an important situation - as obviously with the restructuring of Oculus into the Facebook Reality Lab and Facebook XR operations, breaking off the current operation would be a much more convoluted process if even being considered (which we doubt).

    The reality is that we are seeing governmental sanction levelled at an operation that many had speculated was going to be hit, and hit hard.

    This will obviously have an impact on certain involvements in the XR scene by Facebook - we shall see with the increased Facebook login requirements (having pending legal challenges in State and Country). And obvious possible impacts on next years Facebook MR glasses launch.

    Could this also see an investment pushback, spurred by customer backlash? Time will tell.

  • OmegaM4NOmegaM4N Posts: 1,146
    Wintermute
    ^^I don't think FB are going to have a good 2021 now that both the EU and America have the scent of blood in the water. lol
  • ZenbaneZenbane Posts: 16,879 Valuable Player
    OmegaM4N said:
    ^^I don't think FB are going to have a good 2021 now that both the EU and America have the scent of blood in the water. lol

    The same thing was said after the Cambridge fiasco, and after Facebook faced the US Senate, and after the Zenimax trial. But Facebook only ends up more successful. Facebook stock still hits record highs, while outperforming both Amazon and Netflix.

    The only thing that ever comes out of lawsuits against Facebook and Zuckerberg... are epic memes. The "blood in the water" that you speak of is: money. Facebook has enough money to pay whoever needs to get paid in order to continue with the business as usual. And any outcome from a trial like this will likely only be a perceived change; not an actual change that negatively impacts Facebook nor diminishes Zuckerberg's power.
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  • synchromesh62synchromesh62 Posts: 481
    Trinity
    Zenbane said:

    Facebook has enough money to pay whoever needs to get paid in order to continue with the business as usual. 
    Never say never.
    Bigger companies have once thought the same thing. 

  • ZenbaneZenbane Posts: 16,879 Valuable Player
    edited December 2020
    Zenbane said:

    Facebook has enough money to pay whoever needs to get paid in order to continue with the business as usual. 
    Never say never.
    Bigger companies have once thought the same thing. 


    Very true. Although, can you give me one example of a company that once had the same power as Facebook who was forced by the government to break up, and it actually worked to diminish their power?

    And to be clear, I am not suggesting that it would "never" happen. I'm not speaking in the context of forever ever; I'm only speaking in the context of this particular move by the FTC. Specifically, the fact that the FTC approved Facebook's acquisition of both IG and WA will make it difficult for them to now force Facebook to separate those entities.

    The FTC doesn't have the best track record in its lawsuit efforts. As one example, the FTC lost its lawsuit against AT&T back in 2016:
    https://www.fastcompany.com/4017998/ftc-loses-data-throttling-lawsuit-against-att-due-to-common-carrier-status

    Facebook will certainly fall one day, as all things do in life (e.g. America Online, MySpace). But is Facebook going to fall now because of this FTC thingy? Probably not.
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  • ZenbaneZenbane Posts: 16,879 Valuable Player
    Two important things to note (taken from the article):

    Even if government lawyers win a judgment against Facebook, it would be up to a federal judge what to do about the company’s dominant position. It’s rare for a big company to be broken up, but it’s happened in the past, as with AT&T in 1984.

    The states’ suit does not explicitly call for Facebook to be broken apart, instead asking a federal court to halt Facebook’s anti-competitive conduct in general and take any other action that the court sees fit.

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  • dburnedburne Posts: 4,426 Valuable Player
    About time our government do something about this.
    Don

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  • ZenbaneZenbane Posts: 16,879 Valuable Player
    edited December 2020
    It's the consumers who give Facebook this level of power. It's odd when the Government officials, who are elected by consumers, are trying to undo the power granted by the same consumers. 

    If consumers stopped using Facebook and its products, then none of this would be necessary. What's really the target of regulation here is the lack of self-control by consumers. The whole situation is more amusing than anything else.
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  • synchromesh62synchromesh62 Posts: 481
    Trinity
    edited December 2020
    Zenbane said

    Very true. Although, can you give me one example of a company that once had the same power as Facebook who was forced by the government to break up, and it actually worked to diminish their power?

    Not for that particular reason no and im not saying it would happen.
    I just mean when get in a position where you think you are invincible that is usually when things start to go wrong.
    Forgetting any legal issues and paying people off that's not exactly what i meant. As an example I think 98% of FB's revenue comes from advertising. Covid was kind of a screenshot of possibilities that business maybe will not be able to afford to spend as much on advertising in the current climate which is not getting any better right now and consumers may not be spending as much if they are out of work. Its a chain reaction that may not show itself right away but could escalate quickly. 
  • ZenbaneZenbane Posts: 16,879 Valuable Player
    edited December 2020
    I just mean when get in a position where you think you are invincible that is usually when things start to go wrong.

    That is true, but also a red herring. There's no indication that either Facebook or Zuckerberg believe that they are "invincible." Quite the contrary, they always admit to their failings and then adjust their policies accordingly. If they felt they were invincible, then they wouldn't openly admit to their mistakes and make all the policy changes to try to correct those mistakes.

    Granted, Facebook and Zuck are clearly not angelic with their business practices. But is our Government any better? lol

    We have oil companies spilling crude oil in to our oceans and destroying our ecosystem, and we have banks that go out of their way to help organized crime... yet does our Government intervene? Nope.

    I don't feel that Facebook is trying to show "invincibility" whatsoever. I just think that Facebook is operating within the same corrupt system that runs the world. All of which is made possible by complacent consumers.


    Forgetting any legal issues and paying people off that's not exactly what i meant. As an example I think 98% of FB's revenue comes from advertising. Covid was kind of a screenshot of possibilities that business maybe will not be able to afford to spend as much on advertising in the current climate which is not getting any better right now and consumers may not be spending as much if they are out of work. Its a chain reaction that may not show itself right away but could escalate quickly. 


    Facebook is one of the few organizations that actually thrived as a result of the pandemic.
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  • NunyabinezNunyabinez Posts: 224
    Nexus 6
    Before everyone gets too excited there are a couple of issues you need to be aware of.

    1. It is not illegal to be a monopoly. The government grants some monopolies and some monopolies end up happening simply because the company provides something so superior that it is difficult for others to compete. 

    The issue is whether a company uses their monopoly in an anti-competitive way. For example, pricing below cost to drive a competitor out of the market.

    2. Related to number 1, most of Facebook's services are free to the user. To have cause in a legal action, one has to show harm. It may be very difficult for existing laws to determine that users of Instagram, Facebook and WhatsApp have been harmed by them being under one roof. And even if you drive a free service out of business, and someone has to use your free service instead, were they harmed? That is an interesting question.

    I'm not saying that Facebook is not engaging in activities that cause concern, or that there shouldn't be some kind of oversight, but this is not by any means an easy case for the government.
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  • OmegaM4NOmegaM4N Posts: 1,146
    Wintermute
    dburne said:
    About time our government do something about this.

    It has already began as FB have been forced to block features from their messanger service here in the EU/UK only last week, and that is just the start, so the snowball is strating its run down the snowy hilltop. lol
  • synchromesh62synchromesh62 Posts: 481
    Trinity
    edited December 2020
    Facebook is one of the few organizations that actually thrived as a result of the pandemic.
    As have most internet based companies mainly because of Lockdowns. The same can be said for superstores who have constantly been struggling to keep up with filling shelves etc. But who would have thought 9 months ago that someone as huge as British Airways could be in serious trouble losing billions in the first half of the year. Every company has a weakness that could wipe them out and i guess FB's is just a simple Internet connection or users that choose to use them or not.
  • ZenbaneZenbane Posts: 16,879 Valuable Player
    Facebook is one of the few organizations that actually thrived as a result of the pandemic.
    As have most internet based companies mainly because of Lockdowns. The same can be said for superstores who have constantly been struggling to keep up with filling shelves etc. But who would have thought 9 months ago that someone as huge as British Airways could be in serious trouble losing billions in the first half of the year. Every company has a weakness that could wipe them out and i guess FB's is just a simple Internet connection or users that choose to use them or not.

    Okay, but earlier you tried to imply that Facebook would get less money due to less Ads being created as a result of the pandemic. This is what you said:
    "As an example I think 98% of FB's revenue comes from advertising. Covid was kind of a screenshot of possibilities that business maybe will not be able to afford to spend as much on advertising in the current climate which is not getting any better right now and consumers may not be spending as much if they are out of work. Its a chain reaction that may not show itself right away but could escalate quickly."

    It can't be both. On one hand, your argument implies that FB is getting less money, but then on the other hand your response is that FB (like most internet based companies) was making more money due to the Lockdown.

    They either made less or more due to the lockdowns, not both.

    Also, when I say "thrived" I'm speaking about the fact that Facebook has outperformed most other companies. Not every internet based company can make that claim.
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  • ZenbaneZenbane Posts: 16,879 Valuable Player
    edited December 2020
    OmegaM4N said:
    It has already began as FB have been forced to block features from their messanger service here in the EU/UK only last week, and that is just the start, so the snowball is strating its run down the snowy hilltop. lol

    This is a bit of misinformation. FB, like other companies, have been making feature changes to their products/services for years in response to the EU. This didn't begin now all of a sudden.

    As for the messenger service, the only thing that was blocked is a new feature that FB plans to use for online shopping. Considering EU Privacy laws, blocking this feature makes sense. And it only applies to the EU anyway, so honestly, who cares? lol

    This online shopping feature will still be made available to the rest of us, and none of this has anything to do with the current topic of the FTC legal issues.
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  • OmegaM4NOmegaM4N Posts: 1,146
    Wintermute
    edited December 2020
    And the hits just keep on coming with this one being quite interesting to watch through 2021.

    German regulators are investigating Facebook for its controversial Oculus account rules

    Germany’s competition watchdog is investigating Facebook for tying its social app to its Oculus virtual reality headsets. Today, the Bundeskartellamt or Federal Cartel Office (FCO) announced a probe of the increasingly close link between Facebook and Oculus, arguing that it could hurt competition in both VR and social networking.

    The new Oculus Quest 2 headset requires signing in with a Facebook account rather than a separate Oculus ID, and that’s raised antitrust concerns. “Linking virtual reality products and the group’s social network in this way could constitute a prohibited abuse of dominance by Facebook,” said FCO president Andreas Mundt. Mundt noted that Facebook is a dominant social network in Germany and plays a large role in the emerging VR market. “We intend to examine whether and to what extent this tying arrangement will affect competition in both areas of activity.”

    Facebook halted the original Quest’s sales in Germany earlier this year, citing regulatory concerns. “While Oculus devices are not currently available for sale in Germany, we will cooperate fully with the Bundeskartellamt and are confident we can demonstrate that there is no basis to the investigation,” a spokesperson tells The Verge today.

    Oculus reportedly faces scrutiny in the US as well but on different grounds. Last week, Bloomberg reported that Justice Department antitrust investigators were talking with Oculus app developers, following accusations that Oculus cloned smaller companies’ apps and favored its own alternatives. Facebook sells the popular Oculus Quest 2 VR headset, controls app developers’ access to its official store, and has developed and acquired several popular VR games and apps. That includes the virtual social space Horizon, which competes with smaller independent apps like Rec Room and VRChat.

    The US Federal Trade Commission and 48 state and regional attorneys general sued Facebook for monopolistic behavior yesterday, although that suit doesn’t cover Facebook’s VR efforts. The FCO also has a separate pending case against Facebook. In 2019, it ordered Facebook to stop combining user data from different sources without consent. However, Facebook lodged an emergency appeal, and a hearing is scheduled for March 2021.

    Facebook’s decision to link Oculus hardware with Facebook has rankled users. The company acquired Oculus in 2014. But until recently, users could sign in with separate Oculus IDs, which didn’t require creating a public-facing social profile. Following the Oculus Quest 2’s launch, it started requiring Facebook logins to use new hardware, and some users temporarily lost access to their headsets after being mistakenly banned. Facebook hasn’t indicated plans to reverse the decision, but it’s now facing official pressure to change its rules.




  • dburnedburne Posts: 4,426 Valuable Player
    LOL loving it!! Glad someone is taking on that Oculus/Facebook required linking.
    Don

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  • ZenbaneZenbane Posts: 16,879 Valuable Player
    edited December 2020
    Hmm, well Facebook already halted sales of Quest in Germany back in September:
    https://arstechnica.com/gaming/2020/09/facebook-halts-oculus-quest-sales-in-germany-amid-privacy-concerns/

    This is very old news. Besides, it's Germany's loss. And their citizens will simply find a way to purchase an Oculus Quest 2 anyway, by other means.

    Facebook makes enough money to hire lawyers to deal with these little annoyances. It's all just part of doing business when you're that big and that powerful.

    dburne said:
    LOL loving it!! Glad someone is taking on that Oculus/Facebook required linking.
    As long as users continue to purchase Facebook VR products and give Facebook data by being active on their Platform, such as this very forum, then those users are giving Facebook the power it currently has. It is rather contradictory to willingly give Facebook power while also claiming to love it when other entities try to take that power away.

    It would make more sense to simply... not give Facebook the power in the first place.

    "Dear Germany, please take away the power that I keep giving to Facebook"

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  • OmegaM4NOmegaM4N Posts: 1,146
    Wintermute
    dburne said:
    LOL loving it!! Glad someone is taking on that Oculus/Facebook required linking.

    March 26 is when this case will be heard.
  • ZenbaneZenbane Posts: 16,879 Valuable Player
    OmegaM4N said:
    dburne said:
    LOL loving it!! Glad someone is taking on that Oculus/Facebook required linking.

    March 26 is when this case will be heard.

    Care to make a friendly wager? Loser has to purchase the winner a $50 Steam Card.  B)

    My bet is that Facebook wins the case and keeps their FB required login.
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  • OmegaM4NOmegaM4N Posts: 1,146
    Wintermute
    ^^Wait until 26th Dec in 12 days when all the parents who bought their kids a Q2 for xmas and did not set it up, try to contact FB and Oculus to complain that little Jack and Jill don't have a FB account and they don't want their kids anywhere near any online social media site with a world load of strangers just a toxic filled VR Chat away, and all they wanted is to let them play some VR games, as a lot of them will think the Q2 can be used just like like a Ninty DS or Switch or one of the other consoles. lol
  • dburnedburne Posts: 4,426 Valuable Player
    OmegaM4N said:
    ^^Wait until 26th Dec in 12 days when all the parents who bought their kids a Q2 for xmas and did not set it up, try to contact FB and Oculus to complain that little Jack and Jill don't have a FB account and they don't want their kids anywhere near any online social media site with a world load of strangers just a toxic filled VR Chat away, and all they wanted is to let them play some VR games, as a lot of them will think the Q2 can be used just like like a Ninty DS or Switch or one of the other consoles. lol

    Yeah this will certainly be interesting to watch.
    Don

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  • ZenbaneZenbane Posts: 16,879 Valuable Player
    OmegaM4N said:
    ^^Wait until 26th Dec in 12 days when all the parents who bought their kids a Q2 for xmas and did not set it up, try to contact FB and Oculus to complain that little Jack and Jill don't have a FB account and they don't want their kids anywhere near any online social media site with a world load of strangers just a toxic filled VR Chat away, and all they wanted is to let them play some VR games, as a lot of them will think the Q2 can be used just like like a Ninty DS or Switch or one of the other consoles. lol

    They'll just end up creating a FB account for their kids anyway, since all their kid's friends will also have a Quest 2 and Facebook Account.

    Even the kids that say that don't like Oculus and Facebook  will end up with Quest 2 and a Facebook account. And they'll probably end up on this forum keeping things business as usual lol
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