Facebook hits 1 trillion dollars! If you don’t know how big is 1 trillion dollars, it is 1 million, million dollars!
Facebook hits 1 trillion dollars!
Facebook hits 1 trillion dollars in market capitalization for the first time. This is right after a federal court dismissed the Federal Trade Commission’s antitrust lawsuit against Facebook and helps to boost the price of Facebook up by more than 4% on Monday, bringing the company’s market capitalization to be above 1 trillion dollars for the first time. This makes Facebook the number ve company in the US to reach a trillion-dollar market capitalization.
Facebook hits 1 trillion dollars in market capitalization for the first time. This is right after a federal court dismissed the Federal Trade Commission’s antitrust lawsuit against Facebook and helps to boost the price of
Facebook up by more than 4% on Monday, bringing the company’s market capitalization to be above 1 trillion dollars for the first time. This makes Facebook the number ve company in the US to reach a trillion-dollar market capitalization.
So which companies are the stove, and which is the number 6 company that is the closest to 1 trillion-dollar? So what is this lawsuit that is happening?
It Is usually because most people are also using these apps. Not only that, Facebook has been buying up smaller startups in the social commerce space. Facebook has acquired customers, which is focusing on customer service tools and chatbots. Facebook also bought Snaptu 2011, a developer app, Beluga in
2011, a messaging app that forms the current Facebook Messenger. Face.com, a facial recognition company, and Onavo, a mobile analytics company in 2013, and the list goes on. Well, from the perspective of the FTC, they believe that Facebook has acquired these applications and becomes a monopoly in the personal social networking industry. So as you may know, Instagram and
WhatsApp is the two main applications on top of Facebook that people use daily. So, To increase competition in the market, the FTC proposed in the lawsuit that Facebook was to sell off Instagram and WhatsApp so that other companies have a chance to acquire market share. This is also because
Facebook slowly trying to integrate the applications. As you recall, Facebook, Instagram, and WhatsApp platforms are separate applications at the beginning.
But over the years, Facebook has been quietly establishing a data integration between these apps. According to various articles, Facebook has been not very transparent in how they gather and use the data across the three different platforms. So what do you guys think about this? let me know in the comments below whether this will be benefitting us, consumers, by bringing in more competition to the market. So why did the FTC drop the case? According to the report, the FTC took too long a time to prove that Facebook is guilty. One of the things that the judge asked the FTC is, what is the definition of the market that Facebook is in? The FTC denes the market as Personal Social Networking. They were unable to answer which companies are inside this particular Market. It was mentioned that Facebook owns a majority of the market share, but who
Facebook was sued by the Federal Trade
Commission or the FTC and 46 States of America for buying up companies to reduce competition. This is what they call an antitrust lawsuit. So who sued Facebook? The US government has the authority and the power to make sure that there is no Monopoly in any sector or industry. This is so that people will be able to benet from the constant innovation and prevent an increase in price
without cause. With competition, companies tend to give much better pricing and quality of products and services to their customers. According to the government in December 2020, Facebook is becoming a Personal Social Networking giant, so big that they believe that Facebook is becoming a monopoly in the Personal Social Networking Space. Now, To give you the context, Facebook acquired Instagram for 1 billion dollars in the year 2012 and also acquired WhatsApp for $22 billion in 2014. Most of our mobile phones will have at least one of these applications in your phone, right?
holds the remaining market share? In court, you need to dene everything as clear as possible, What is the definition of personal social networking? Does it mean any app that can send messages? Or an app that you post pictures in Videos? It is like you are asking what is a superhero. Does the superhero need
to have special powers? Or does it just have to wear a cape? The FTC also has to prove how it is dominating the market, and how are they holding off new competitors. since the FTC took too long a time to answer many of such questions given by the judges, the judge has announced to dismiss this
lawsuit. This is not the first time that a company that we know faced an antitrust lawsuit. Take for example in April this year, Epic, the company behind the popular video game, Fortnite, sued Apple because Apple kicked Fortnite off the Apple Store last year because Epic offers its customers an alternative way to make payments to avoid the mandatory 30% commission charged by Apple. As you can tell from the Facebook antitrust lawsuit trial, it takes many many years to complete the case. The trial will determine whether Apple is a monopoly in its industry, which they need to figure out which market is it. So I can sense that the lawsuit that Apple is going through will take a few years to clear. Certainly, this is not something new to Google. December last year, Google also faced its third government antitrust lawsuit in less than 2 months. Being good at something is not easy right? This shows that the US government is concerned about how the big tech in the USA is becoming too big, and Facebook is one of them. This is a large hit to the states as there are currently many such lawsuits still pending. But it may not stop here, the FTC could still le a new complaint by July 29th according to the judge. And of course, even if it exceeds July 29th, the FTC or the states are still able to a lawsuit when they nd new evidence. The lawsuit is being dismissed because of the lack of evidence and there are plenty of questions that are left unanswered by the FTC.
Well, we’ll see what happens next. You may ask, what is the use of such antitrust lawsuits? why are they spending such a huge amount of taxpayers’ money to sue companies for such a practice? How is this beneficial for the consumers and the Investors? Antitrust laws are mainly enforced to protect consumers. Should there be competition in the market, companies will be more careful in their pricing structure so that they remain competitive. This means that the consumers will be able to get their products and services at a competitive price. Companies will also constantly innovate to make sure that
they can outperform their competitors. Have you ever faced a certain company that dominates the industry and you are a happy customer until they increase the price so much but you have no other alternatives to go? That is one of the things that the FTC is looking out for. However, what does this mean to the investors? It is a piece of good news to investors who hold a company that is being sued for being a monopoly. This is in a way, proving that the company is a good company to invest in. They are the Monopoly! they are the best in the industry! Let us go back to Facebook.
What if Facebook loses the legal case in the future? What does it mean for the investors?
For Facebook investors, Should Facebook lose the case, the investors will still get a portion of the split
companies. For example, should Instagram and WhatsApp be required to form new entities on their own, the current Facebook investors will get a small portion of each company. Even so, the share price of Facebook has been beaten down for many months since the case. Since the lawsuit didn’t go through this time, the investors are excited and that is helping the price to move up more than 4% in the day. With that increase in pricing, Facebook reached 1 trillion dollars in market capitalization for the first time in its history. Facebook is not the first company that reaches 1 trillion dollars in market capitalization. Facebook is the first company in the US that managed to do so.