Twitter CEO attempts to mine cryptocurrency, Zoom app downloads trend lower and other notable stories from this week
Welcome to “#SocialStocks,” The Fly’s weekly recap of Wall Street’s reactions to social media stock news.
ANTITRUST LATEST: The Federal Trade Commission has filed an amended antitrust complaint against Facebook in the U.S. District Court for the District of Columbia and requested that the Clerk of the Court file the FTC’s unredacted First Amended Complaint under seal for ten calendar days from the date of this Court’s order on its related motion. “The FTC has both good cause and a compelling reason to file an unredacted version of its First Amended Complaint temporarily under seal. Before bringing this action, the FTC conducted a non-public investigation into the anticompetitive conduct through which Facebook maintained its monopoly power in the market for personal social networking services in the United States. The FTC’s First Amended Complaint includes certain information related to this conduct that Facebook, Inc. and/or third parties designated as ‘confidential’ during the course of the investigation. Before the FTC publicly discloses such information in a law enforcement proceeding, the FTC must afford the providing parties an ‘opportunity to seek an appropriate protective or in camera order.’ In addition, the FTC’s First Amended Complaint references statistics calculated based on data obtained from third parties that is not publicly available and may be commercially sensitive,” the complaint and a related order filed with court stated. “The complaint alleges that after repeated failed attempts to develop innovative mobile features for its network, Facebook instead resorted to an illegal buy-or-bury scheme to maintain its dominance. It unlawfully acquired innovative competitors with popular mobile features that succeeded where Facebook’s own offerings fell flat or fell apart. And to further moat its monopoly, Facebook lured app developers to the platform, surveilled them for signs of success, and then buried them when they became competitive threats. Lacking serious competition, Facebook has been able to hone a surveillance-based advertising model and impose ever-increasing burdens on its users.” The FTC filed the amended complaint in the U.S. District Court for the District of Columbia, following the court’s June 28 ruling on the FTC’s initial complaint. The amended complaint includes additional data and evidence to “support the FTC’s contention that Facebook is a monopolist that abused its excessive market power to eliminate threats to its dominance,” the FTC said. “The FTC’s Office of General Counsel carefully reviewed Facebook’s petition to recuse Chair Lina M. Khan. As the case will be prosecuted before a federal judge, the appropriate constitutional due process protections will be provided to the company. The Office of the Secretary has dismissed the petition. The Commission vote to authorize staff to file the amended complaint in the U.S. District Court for the District of Columbia was 3-2,” Facebook responded via its “Newsroom” account on Twitter: “We are reviewing the FTC’s amended complaint and will have more to say soon.”
Despite antitrust crackdowns around the world, Barron’s believes shares of Facebook, along with other Big Tech names, are “unstoppable.” Big Tech has hit a perilous moment but it won’t last, Eric Savitz and Max Cherney wrote in this week’s edition of Barron’s. The five megacaps – Apple (AAPL), Microsoft (MSFT), Alphabet (GOOG,GOOGL), Amazon (AMZN), and Facebook – still have the best business models on the planet, and their stocks look relatively cheap, the author notes. Investors should own them all, even if the regulatory headwinds take a while to abate, the publication adds.
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