Summary of “It’s time to break up Facebook”

“We live in America, which has a strong and proud tradition of breaking up companies that are too big for inefficient reasons,” Wu told me on this week’s Vergecast.
“We need to reverse this idea that it’s not an American tradition. We’ve broken up dozens of companies.”
“I think if you took a hard look at the acquisition of WhatsApp and Instagram, the argument that the effects of those acquisitions have been anticompetitive would be easy to prove for a number of reasons,” says Wu. And breaking up the company wouldn’t be hard, he says.
Breaking up Facebook could be simple under the current law, suggests Wu. But it could also lead to a major rethinking of how antitrust law should work in a world where the giant platform companies give their products away for free, and the ability for the government to restrict corporate power seems to be diminishing by the day.
Making a case for breaking up these companies will rely on showing a different type of harm than high consumer prices – something like anticompetitive practices, or that innovative businesses get suffocated when they’re absorbed by their gigantic acquirers.
Won’t getting bigger and bigger lead companies like Facebook and Google to make mistakes, become slower, and create opportunities for new challengers? That has largely been the belief of the tech industry, which has seen the fortunes of companies like AOL, Myspace, and Yahoo dramatically rise and fall.
“A whole generation of companies – Google, Facebook, some of these early companies – they don’t owe everything to antitrust, but they owe a sizable debt to the antitrust law,” he says.
“If you wait long enough, maybe 100 years, they’ll go away. But we could very well have Facebook – an inefficient, ineffective, obsolete company – hanging around for another 20 years,” says Wu. “I’m just not really sure that’s what we need.”

The orginal article.