A couple of weeks ago, Facebook had the industry in a frenzy when they announced that they would be acquiring instant messenger app, WhatsApp, for a whopping $19 billion, making it several more times more expensive than what they paid for Instagram which was $1 billion.
In a way this is a good move for Facebook as they would acquire one of the world’s most popular and most used instant messaging services, but it seems that not everyone is too pleased about the deal as two consumer groups have recently filed a complaint with the Federal Trade Commission, asking them to investigate the pending acquisition.
So what’s the big deal? Are they worried about Facebook monopolizing the instant messenger market? Well according to the Electronic Privacy and Information Center (EPIC) and Center for Digital Democracy (CDD), they claim that Facebook will use WhatsApp’s user data for other purposes, and it will not be what WhatsApp users have signed up for when they downloaded the app.
They claim that this violates WhatsApp users’ understanding of their exposure to online advertising, and that it is considered to be an unfair and deceptive trade which is why the FTC should investigate the acquisition.
Naturally Facebook disagrees with the claims, stating, “Facebook’s goal is to bring more connectivity and utility to the world by delivering core Internet services efficiently and affordably – this partnership will help make that happen.”
A spokeswoman for Facebook later reiterates the fact that WhatsApp will be operated as a separate company. “As we have said repeatedly, WhatsApp will operate as a separate company and will honor its commitments to privacy and security.” Be that as it may, we’re sure somewhere down the line Facebook will have plans for WhatsApp, if they didn’t already, but what do you guys think?
Do these consumer groups make a good point that the FTC should take into consideration?