FTC Chair Issues Monopoly Warning as Facebook Decision Nears

The chairman of the Federal Trade Commission said antitrust enforcers need to be worried about dominant companies buying startups that are emerging competitive threats -- highlighting one of the main issues in the agency’s investigation of Facebook. Chairman Joe Simons said that takeovers of nascent competitors can be harmful to consumers and said that enforcers need to be ready to step in to stop such deals. “A monopolist can squash a nascent competitor by buying it, not just by targeting it with anti-competitive actions,” Chairman Simons said at an American Bar Association conference. “It may be easier and more effective to buy the nascent threat, only if to keep it out of the hands of others.” “We must be willing and able to recognize that harm to competition might not be as obvious from a look at the marketplace as it stands currently,” said Chairman Simons. If officials only consider a “static picture” of a market, “then we risk forfeiting the benefits of competition that could arise in the future.”