Welcome to "#SocialStocks," The Fly's weekly recap of Wall Street's reactions to social media stock news.
ANTITRUST PROBE OF FACEBOOK AND GOOGLE: On September 6, New York Attorney General Letitia James released a statement confirming the "bipartisan coalition" she's leading investigating social media giant Facebook (FB) for antitrust issues: "Even the largest social media platform in the world must follow the law and respect consumers. I am proud to be leading a bipartisan coalition of attorneys general in investigating whether Facebook has stifled competition and put users at risk. We will use every investigative tool at our disposal to determine whether Facebook's actions may have endangered consumer data, reduced the quality of consumers' choices, or increased the price of advertising." Joining Attorney General James on the leadership team investigating Facebook are the attorneys general of Colorado, Florida, Iowa, Nebraska, North Carolina, Ohio, Tennessee, and the District of Columbia. The investigation focuses on Facebook's "dominance in the industry and the potential anticompetitive conduct stemming from that dominance."
Similarly, on September 9, Attorney General Ken Paxton announced that Texas is leading 50 attorneys general in a multistate, bipartisan investigation of tech giant Google's (GOOG, GOOGL) business practices in accordance with state and federal antitrust laws. The bipartisan coalition announced plans to investigate Google's overarching control of online advertising markets and search traffic that may have led to anticompetitive behavior that harms consumers. Legal experts from each state will work in cooperation with Federal authorities to assess competitive conditions for online services and ensure that Americans have access to free digital markets. "Now, more than ever, information is power, and the most important source of information in Americans' day-to-day lives is the internet. When most Americans think of the internet, they no doubt think of Google," said Attorney General Paxton. "There is nothing wrong with a business becoming the biggest game in town if it does so through free market competition, but we have seen evidence that Google's business practices may have undermined consumer choice, stifled innovation, violated users' privacy, and put Google in control of the flow and dissemination of online information. We intend to closely follow the facts we discover in this case and proceed as necessary."
FACEBOOK LAUNCHES FACEBOOK DATING IN U.S.: On Thursday, September 5, Nathan Sharp, a Facebook Product Manager, announced in a post to the company's site the launch of Facebook Dating in the U.S. "We're also giving people the ability to integrate their Instagram posts directly into their Facebook Dating profile and giving people the ability to add Instagram followers to their Secret Crush lists, in addition to Facebook friends. By the end of the year, we'll make it possible to add Facebook and Instagram Stories to your Dating profile too," Sharp stated in the post. Match Group (MTCH), which owns Tinder and other dating properties, competes in the dating space and moved lower following the announcement. In slides presented by Match Group CFO Gary Swidler at the Deutsche Bank 2019 Technology Conference, on September 10, the company said Match Group subscriber growth is "not impacted" by the launch of Facebook Dating. The slide included data regarding the previous launches of Facebook's dating service in Canada and other countries.
TWITTER DISABLES TWEET VIA SMS: In a tweet on September 5, Twitter (TWTR) said, "We're temporarily turning off the ability to Tweet via SMS, or text message, to protect people's accounts. We're taking this step because of vulnerabilities that need to be addressed by mobile carriers and our reliance on having a linked phone number for two-factor authentication (we're working on improving this). We'll reactivate this in markets that depend on SMS for reliable communication soon while we work on our longer-term strategy for this feature." This decision came after Twitter's co-founder and CEO, Jack Dorsey, had his account hacked using this method, which resulted in a string of offensive tweets being posted from his account.
LINKEDIN LOSES APPEAL OVER USER DATA ACCESS: On September 9, Reuters' Jonathan Stempel reported that the 9th U.S. Circuit Court of Appeals dismissed LinkedIn's effort to stop a San Francisco company from using data that users of the networking site have deemed public. The appeals court let stand a preliminary injunction from two years ago that required the Microsoft (MSFT) business to give hiQ Labs access to publicly available member profiles, Stempel Said. The 3-0 decision by the court is a setback in the tech industry's battle against "data scraping," or extracting data from social media accounts or websites, which critics claim can equate to theft or violated users' privacy, the author noted.