Facebook is on the way to its journey from a personal social network to virtual reality metaverse. However, of late, it faces challenges. The price of its stock declined by 26 per cent on account of poor financial results. Its business of targeted advertising has become vulnerable due to change in Apple’s privacy policies. It also faces a threat from the legislators in the EU and US who may introduce similar measures.

The Federal Trade Commission (FTC) claims that Facebook followed a ‘buy or bury’ strategy. It acquired WhatsApp and Instagram to protect its monopoly power. It continues to follow buy or bury strategies to move into VR. The FTC offered enough evidence that buys of WhatsApp and Instagram were to neutralise actual and likely future competitors.

However, FTC case faces a convincing argument. Facebook is free and so there is no question of it being a monopoly. What is to be proved that Facebook is charging predatory low prices to drive out competitors. Or alternatively it is prohibitively costly and hurts the consumers. Facebook being free, runs the argument, is harmless. The FTC feels that even a free monopoly could be harmful. It is difficult to prove this. Even then Facebook exercises monopoly power in the market of personal social network.

The suit ties up the company in a legal battle and puts tremendous pressure on the revenues. FB earns close to 99 per cent of its revenues in advertising — say $118 billion in 2021, with $39.4 billion in profits.