Facebook to pay £4billion fine as tech giants face huge US government antitrust investigation
FACEBOOK is to pay a £4billion fine to resolve a US privacy probe.
The Federal Trade Commission’s penalty is believed to be the biggest imposed on any company for violating the privacy of consumers.
The FTC had been probing claims that consultancy Cambridge Analytica improperly obtained the data of 87million Facebook users.
The investigation then widened to include issues such as facial recognition.
The FTC’s Joe Simons said: “Facebook undermined consumers’ choices despite repeated promises that they could control how personal information is shared.”
He said the fine’s size was designed “to change Facebook’s entire privacy culture to decrease the likelihood of continued violations”.
Facebook must also establish an independent privacy committee that boss Mark Zuckerberg will not have control over. US authorities have also started a probe into whether online platforms are unfairly restricting competition.
The Department of Justice said it has taken into account "widespread concerns" about the impact of social media, search engines and online retailers.
PRIVACY SCANDALS
Makan Delrahim, the department's chief antitrust officer, said: "Without the discipline of meaningful market-based competition, digital platforms may act in ways that are not responsive to consumer demands.
"The Department's antitrust review will explore these important issues."
Investigators are seeking information from the public - including those in the tech industry.
It marks a pivotal moment following months of concern in Congress and elsewhere over the sway of firms like Google, Facebook and Amazon.
There have been calls for stricter regulation or even breakups of the big tech companies amid intense criticism following a number of privacy scandals.
The FTC also reportedly plans to hand Google a multimillion dollar fine over its handling of children's information on YouTube.
TRUMP CRITICISM
Europe has already investigated and fined several major tech companies over the past several years.
President Donald Trump also has repeatedly criticised the big tech companies by name in recent months over alleged bias against him.
Amazon and Facebook had no comment, while Apple and Google referred inquiries to recent public statements by their execs.
Shares of Facebook, Amazon and Apple were down slightly in after-hours trading.
Investigators are expected to have a tough time pinning any wrongdoing on the major tech giants.
Traditional antitrust law focuses on dominant businesses that harm consumers through price-gouging.
BUYING UP RIVALS
Many tech companies offer free products paid for by a largely invisible trade in users' personal data.
But they could face scrutiny for consistently buying up smaller rivals that might be a threat to their business.
Google bought YouTube in 2006 when it was still a fledging video site.
And it acquired the technology for its now-dominant Android software in an even smaller deal.
Facebook snapped up Instagram - now the fastest-growing part of its business - in its infancy.
Apple bought the technology powering its Siri assistant.
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Attorney General William Barr said in January that tech companies appeared to grow huge "under the nose" of antitrust enforcers.
He added: "You know, you can win that place in the marketplace without violating the antitrust laws.
"But I want to find out more about that dynamic."
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