The European Commission and the UK are launching separate investigations into Facebook citing antitrust concerns over the Facebook Marketplace and the company's use of classified advertisements on the platform. In particular, regulators are concerned that Facebook is unfairly using advertising data to distort competition.
Speaking on the investigation, the European Commission's Margrethe Vestager, said: “Facebook collects vast troves of data on the activities of users of its social network and beyond, enabling it to target specific customer groups. We will look in detail at whether this data gives Facebook an undue competitive advantage in particular on the online classified ads sector, where people buy and sell goods every day, and where Facebook also competes with companies from which it collects data.”
As pointed out by The Verge, there has already been a preliminary investigation into this, which raised enough concern to warrant a closer look at Facebook's business practices. The main concern seems to be that Facebook may be collecting data from rival companies through classified ads and then using that information to compete with them. The UK Competitions and Markets Authority is also investigating Facebook over the same concerns.
Facebook has of course already responded, claiming that these allegations are “without merit”, adding that Facebook Marketplace and other services, like Facebook Dating, are part of “highly competitive” markets.
KitGuru Says: These investigations often take a long time to complete, so it could be a while before we see a verdict. This certainly wouldn't be the first time that Facebook has faced scrutiny over data collection and the ways it uses that data.