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Facebook’s dominance is built on anti-competitive behavior
- mrits 6y ago“We can imagine a social network market that worked more like the current phone system: a user of one social network could post and reach friends who were members of different social networks through interoperability protocols.” How about SMTP?
- knodi123 6y agoI think RSS is a better fit.
- cabalamat 6y agoOr ActivityPub
- Barrin92 6y agoforcing interopariblity and one common social network protocol akin to railroad companies being forced to operate compatible networks would be one of the simplest and straight forward regulations to increase consumer choice and balance out market dominance.
- gonzo41 6y agoJust for a laugh, have a read about train rail gauges. You think in Australia a small country, this would be a simple problem. https://en.wikipedia.org/wiki/Rail_gauge_in_Australia https://en.wikipedia.org/wiki/Rail_gauge_in_Australia
- mynameismonkey 6y agoSmall compared to what? It's 80% the land mass of the USA, and the sixth largest country by land mass in the world.
- oska 6y agoI saw the Washington Post describe Victoria as a small state today (in its Covid-19 coverage of the outbreak there). I went and looked up its size to compare to US states - it's bigger than Minnesota and Utah and all but 11 US states. I doubt the WaPo would refer to Utah as a small state.
- gonzo41 6y agoI think of us as a small country because whilst large in size. we only have 7 largish cities, and 25 million people packed into them. With Sydney and Melbourne having close to 10 million people between them.
- ikeyany 6y agoThis is why they called Victoria a small state: https://i2.wp.com/australian-population.com/wp-content/uploads/2018/10/VIC.jpg https://i2.wp.com/australian-population.com/wp-content/uploa...
- cs702 6y agoThe actual paper is available for free download here: https://www.omidyar.com/sites/default/files/Roadmap%20for%20an%20Antitrust%20Case%20Against%20Facebook.pdf https://www.omidyar.com/sites/default/files/Roadmap%20for%20... On a related note, see also this work about Amazon on the Yale Law Journal: https://www.yalelawjournal.org/note/amazons-antitrust-paradox https://www.yalelawjournal.org/note/amazons-antitrust-parado... Meanwhile, Google is already dealing with an antitrust lawsuit from 48 US states: https://www.cbsnews.com/news/google-antitrust-probe-48-u-s-states-launch-antitrust-investigation-of-google-dominance-in-search-ads-and-data/ https://www.cbsnews.com/news/google-antitrust-probe-48-u-s-s... Regardless of one's view on the merits of all these accusations of anti-competitive behavior, it's clear that the 'political winds,' as it were, are blowing quite a bit more in a direction that goes against these three companies. It wouldn't surprise me if all three end up fighting in courts for the better part of a decade if not longer.
- jon_elbrook 6y agoWater is wet, study finds.
- dang 6y ago"Please don't post shallow dismissals, especially of other people's work. A good critical comment teaches us something." https://news.ycombinator.com/newsguidelines.html https://news.ycombinator.com/newsguidelines.html
- deleted 6y ago[deleted]
- alexmingoia 6y agoThe only practice listed in the paper that could be construed as anti-competitive is acquiring other “social networks.” However, it’s a stretch to consider every website that a user can use a competitor to Facebook. It’s not like Facebook acquired a MySpace or anything. But why are acquisitions anti-competitive? Nothing forces the competitor to sell. Acquisitions prove people can compete. It’s a contradiction to say the network effect protects Facebook but at the same time say they had to buy Instagram because they were successfully competing despite the network effect. Facebook’s network effect didn’t stop Instagram, Snapchat, WhatsApp, etc.
- deathgrips 6y ago>But why are acquisitions anti-competitive? Because now there's less competition.
- alexmingoia 6y agoInstagram didn't have to sell. Less competition isn't the same thing as preventing competition. For example, imagine three restaurants competing. Two of them make an agreement with a common supplier to shut out the third competitor. That is what I think of as anti-competitive.
- kthxbye123 6y agoThere’s over a hundred and twenty years of antitrust enforcement in this country. Why does HN insist on reinventing antitrust law from their own intuition about what “anti-competitive” means?
- btmoney06 6y agoThere’s over a hundred and twenty year of antitrust law that says that conduct is improper if it leads to higher prices for consumers. Why does Yale insist that antitrust can apply when prices are 0?
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- Cyclone_ 6y agoDiaspora had the idea of decentralized social networks a while ago by having interoperability between social networks. It never really took off, but I think it would be a good way of limiting 1 social network from getting too powerful.
- smt88 6y agoI assume you mean legislation requiring social networks to be interoperable. This is a good idea and is common in other industries. The problem is that an interoperable social network effectively has an open API with no rate limit. It's tough to solve the technical side of that in a user-protecting way.
- Temasik 6y agowhat about weechat and alibaba or gmail and youtube ;)
- oska 6y agoI think the very unhealthy dominance of Facebook will only start to properly recede when countries outside the USA start to block its use. This is a highly predatory company that takes away sovereignty in each nation's cyberspace and it really only makes sense for foreign countries to block it and either let their own national corporate replacements emerge (as China has done) or foster the use of open social networks and protocols (my strong preference). This doesn't solve the problem for people in the USA of course (well, other nations fostering open social networks will help some). The USA obviously needs to look at antitrust measures to fix the issue at home. But other countries can't afford to wait for that to happen.
- pwdisswordfish2 6y agoSounds about right as Facebook have admitted they cannot grow anymore in the US. Any growth must come from outside the US.
- hkai 6y agoJust to check, between Facebook and WeChat, which company engages more in predatory, racist and violent practices and is complicit in unthinkable brutality and violations of human rights?
- cambalache 6y agois it a competition? Because nobody is winning. Nobody in the world says, oh please Americans come to fuck us because at least you use lubricant.
- deathgrips 6y agoHow do I save comments?
- fsflover 6y agoYou click on the time of the comment, then click “favorite”
- throwawaysea 6y agoWhat about Twitter? Or Visa? Or anyone with network effects and audiences larger than 100 million users?
- lawrenceyan 6y agoPost from the same author on Google: https://insights.som.yale.edu/insights/the-antitrust-case-against-google https://insights.som.yale.edu/insights/the-antitrust-case-ag...
- neilwilson 6y agoFacebook always reminds me of a modern version of Compulink CIX - which spent a lot of its time keeping the rest of the Internet out of its internal bulletin board back in the early days of Internet access. Facebook posts not showing up on the search engines and hidden behind a sign up "pay with your privacy"-wall are very equivalent. CIX forums still exist, but they are nowhere near as influential as they once were. Perhaps Facebook will go the same way.
- microtherion 6y ago> Facebook posts not showing up on the search engines I'm conflicted about this one. Personally, I wish that Pinterest content would not show up in search engine results; I've yet to see one that was useful in any way to me. I could imagine that FB results would be similarly clogging up search results with little value.
- mclightning 6y agoThat's more on Search Engines to keep up with the changing times. They could introduce exclude Social Media toggle easily for FB.
- nabla9 6y agoThomas Philippon (NYU professor) has nice new book "The Great Reversal: How America Gave Up on Free Markets" https://www.hup.harvard.edu/catalog.php?isbn=9780674237544 https://www.hup.harvard.edu/catalog.php?isbn=9780674237544 Here is an interview with Philippon that has some of the main points: https://promarket.org/2019/12/09/the-lack-of-competition-has-deprived-american-workers-of-1-25-trillion-of-income/ https://promarket.org/2019/12/09/the-lack-of-competition-has...
- ankit219 6y agoAntitrust laws were always based on supply side monopolies, while this is a demand side monopoly, and would be a tricky case for anti trust to prove. If the mandate is to do what is best for customers, then the best solution I can think of is to let FB function as one entity but toughen the norms on data collection. The other thing is Facebook should not inhibit any other social network trying to grow using FB's graph. A good example is how Instagram grew with the import of Twitter social graph, and when it came to Facebook, it grew further because it could import the connections that Facebook already had access to. In the name of privacy, it is a good idea to block that, but that essentially inhibits any other social network growing and becoming big. If such an export is available and allowed (while satisfying the privacy concerns), this could enable competition in the social space. As a gatekeeper, Facebook has every intention not to allow any usage to the graph. The idea about breaking up of social networks would not do any good. You would eventually have to solve multiple problems (and again and again) as the broken up entities either die or become dominant in a big enough niche. Even if you break up Instagram or Whatsapp from Facebook, they are still monopolies in their domains. Insta might not be able to survive since they used the Facebook's ad delivery intelligence, while Whatsapp would be a dominant monopoly in messaging nonetheless. This is a landmark case if brought on, but needs to be dealt very smartly, if they want to actually solve problems and set the right precedents.
- loceng 6y agoLaws need to be updated to account for the network effects of the data lock position, where you, your data, and network are prevented from easily being mobile. Your digital data should be considered to be equivalent to you having built a house, a big asset, but now you have a big choice to make: abandon it because the state is doing some sketchy things that you don't agree with or want to support by the taxes collected, or not. The lack of data portability, mobility of users, is the only reason Facebook and its leadership could repeatedly be a bad actor and continue to scale as it did; by data portability I also mean that all data should also maintain cross-linking attribution, so if anyone in your network also leaves Facebook to join platform X instead - that data can be imported and aligned, synchronized properly on the other platform so it doesn't get broken. None of the incumbents are going to voluntarily to implement this.
- machinehermit 6y agoFacebook obviously posses some interesting questions on various topics but framing the debate as Facebook collecting "monopoly rents" is ridiculous. I haven't used Facebook since 2010 and I have never used Instagram. If someone in my social network wants to send me some information they have my number and they can txt me. If someone wants to send me a picture they can do the same. I don't use Facebook because ultimately for me it is completely redundant. To call Facebook a monopoly is an analogy at best. You are not going to solve these problems through analogy though, these are uniquely new problems.
- beagle3 6y agoYou are not the customer. Advertisers are. Google and Facebook are the only games in town for online advertising these days; the fact both are making incredible amounts of money means either competitors aren't good enough, or are being priced out of the market, or squeezed out of it (due to network effects or anti-competitively). For Google - the vast majority of whose income comes from search ads - there is no network effect. They are mostly much better (I try Bing every now and then, it's not even close; I set up ddg as my main search, but have to reach for google for about 1/3 of searches). However, they also employ tactics one could consider anticompetitive, e.g. paying Apple billions/year to be the default search engine on iPhones. YouTube does have a network-effect lock in, but AFAIK that's not really a revenue source for google. It does complete the advertising offering and keep newcomers out, though. For Facebook - they are hardly doing anything better than competitors; it's all about the network effect. And they've been VERY busy making sure that every network which is big enough (or even growing quickly enough) to have its own network effect is either theirs (instagram, whatsapp) or sidelined (snapchat). IIRC They paid $60M for Onavo - providing discounted bandwidth "safely encrypted" from the prying eyes of user's ISP but totally visible to Facebook, which gave them a real-time sample of application and website use -- which gave them the insight needed to purchase rising stars Instagram and reigning king WhatsApp (and attack Snapchat after they refused a buyout offer). You are not Facebook's customer. You are a user, Facebook's product, sold to Facebook's customers, the advertisers. Facebook and Google have a duopoly on online advertising (which, especially now with lockdown, but even independently, is nowadays much of advertising). There are unique new problems with these new models, but Facebook is definitely one part of a duopoly, and likely a monopoly by any existing legal definition.
- mtgx 6y agoIf you look deep enough, you'll find that all the monopolies or near-monopolies in a market are based on anti-competitive behavior. This is why I think anti-trust laws should be a lot more pro-active and all dominant players should be denied mergers about X amount (where X would be an optimal sum of money like say $1 billion or $100 million company value).
- m3kw9 6y agoMost capitalist dominance is built on anti competitive behaviour
- formercoder 6y agoAny firm will attempt to achieve as close to a monopoly as regulators allow, as that’s how you maximize margins and thus value to shareholders.
- scarface74 6y agoThe question is how does this “monopoly” hurt consumers? It’s social media. I use FB, just like most of the rest of the world. But if it died tomorrow the world would go on. Besides, anti trust in the US is focused on consumer harm. How does a Facebook’s monopoly hurt consumers?
- snarf21 6y agoI'm not trolling but the same way ALL monopolies hurt consumers and the fair market. It is not a hard thing to read on up monopolies across history. And it isn't just FB. We need to stop the M&A activity that is only good for the VCs and not the consumers. We need to start unrolling the ones that have already happened.
- noble_pleb 6y agoBut the difference is that "ALL OTHER" monopolies are priced whereas facebook is a free product. Can it be called a monopoly if your product is free? Pretty sure, most lawyers won't have a hard time convincing a jury that it can't be. Besides, if FB is a monopoly then so are Twitter, Google, Reddit, Quora, etc. Its an oligopoly of sorts with each player dominating a slightly differentiated product and all products are free of cost.
- beagle3 6y agoFB's users are not it's customers. It is free for users, in the same way that food is free for cows in a diary. Indeed, the cows did not choose to live that life, but increasingly [not] having a facebook account is not an option. FB's customers are the advertisers. And they pay very good money, or FB wouldn't have had the money pay for WhatsApp, Instagram and its tens of thousands of employees.
- noble_pleb 6y ago>> but increasingly [not] having a facebook account is not an option. but so is the case for google maps, gmail, linkedin, twitter, uber and a zillion other services. Facebook is just like any other web service at the end of the day. >> FB's customers are the advertisers. Even if that's true for arguments sake, I don't see how FB becomes a "monopoly" in that case. There are potentially large # of advertisers buying advertising space from potentially large # of website owners. How does FB have a monopoly on advertiser spending?
- rbrtl 6y ago> by misleading users and buying potential rivals As a Brit, I thought this was how Americans do business.
- cheesecracker 6y agoWhatever. Why should companies help out their rivals? To this day, nobody is forced to use Facebook. I am not against helping rivals, synergies, whatever. But to claim it is unfair not to help rivals seems silly. Invariably, if somebody is successful, some people will emerge claiming it was all unfair gains. Not that I liked Facebook's approach, especially in the early days they were harvesting address books. It's not really an uncommon practice, though. The key point is, again, that nobody is forced to use them. It may be a bit more difficult to avoid their tracking on web sites, but then it is on those web sites not to use the Facebook scripts. And if you really care, you can install an AdBlocker.
- shallowthought 6y agoHas Facebook, and Mark Zuckerberg in particular, ever really made a secret of being a ruthless anti-competitive asshole? I always thought that was his one redeeming trait - the fact that he was honest about it. True, he occasionally claimed in interviews to be about "bringing people together", but I always felt he went out of his way to make sure everyone listening knew he didn't mean it.
- camelCaseCamel 6y agoYale is named after a slave trader, Elihu Yale. We should be suspicious of anything coming out of there until they change their name, make amends to the Black community and even pay reparations. #Cancelyale #BLM