Facebook Inc (FB) Continues to Avoid Antitrust Concerns, WhatsApp Deal to be Unconditionally Approved

Facebook Inc (NASDAQ:FB)’s $19 billion purchase of WhatsApp will be approved unconditionally by EU regulators according to Reuters, removing the final barrier between the social media giant and mobile messaging startup. As Jon Fortt said on CNBC today, the deal, which was originally announced on February 19, is another example of Facebook Inc (NASDAQ:FB)’s ability to deftly avoid antitrust concerns.


“When you look at it, Facebook has been extraordinarily good at avoiding antitrust issues, considering the scale and influence they have” Fortt said.

While regulators have been pressured by the telecom industry regarding WhatsApp and its plans to provide free voice calling to its 600 million users, and apply concessions on Facebook Inc (NASDAQ:FB)’s deal as a result, Facebook Inc (NASDAQ:FB) successfully argued that the deal itself was not anti-competitive, and that such sanctions would therefore be unjustified.

The fact that both Facebook Inc (NASDAQ:FB) and WhatsApp are free services and customers are not locked into contracts or the like with them was also cited as a factor in the commission’s decision, since users affected by the deal are free to switch to other services if they’re unhappy with the deal or any resulting changes to services that arise from it.

Another factor may have been the relatively low barrier-of-entry into the mobile messaging market, and the fact that the sector is characterized by rapid changes and success stories, like WhatsApp’s own. Were mobile messaging a more entrenched market where WhatsApp was seen as a dominant and unassailable force, the deal may have met more resistance.

The deal was approved by U.S regulators back in April, who offered but one caveat to WhatsApp; that they maintain their privacy practices following the merger, and not adopt a targeted ads platform that would make use of customer data.

Facebook Inc (NASDAQ:FB) is trading at $77.89 in afternoon trading, just under its 52-week high of $78.94.

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