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Big Tech Monopolies: List of Facebook's Mergers

/ data privacy, big tech, big data

As you may or may not know, Facebook is notorious for buying out competition.

This is especially true when that competition is something they can't beat outright or poses a serious threat to "their market." Instead of competing, they whip out their wallet and fork over cash.

Not to mention, you probably already know that Facebook is also notorious for abusing users' data privacy by...

  1. breaking both the law and their very own privacy policy
  2. collecting extensive amounts of data without user consent
  3. abusing the data collected.

Because of their abusive data practices, it's important to be aware of what services are owned/operated by Facebook. Ideally, in the pursuit of better online privacy, you should avoid services tied to Facebook.

This is a post in our "Big Tech Monopolies" series.

Facebook's ecosystem

When it comes to data, Facebook wants to be king of all data. This includes yours, mine, and each of our neighbors'.

Facebook literally functions to collect, analyze, and effectively consume all data collected from various aspects of your life. This comes from the social media platform placing a scary amount of emphasis on "connecting people."

But wait, avoidthehack!, how is "connecting people" a bad thing?

It's not. But when you use it as a way and/or excuse to extensively surveille and exploit people's data for profit and/or power, then that's where the issues start.

See, on a basic level, Facebook functions on user engagement. Users must log in, post content, or engage with other users/content on Facebook's platform for it to function.

Facebook wants to retain high engagement rates. The best way to do this is to put content that users like directly in front of them.

So, in order to do this Facebook gathers data about you (the user). This data can be provided by you or "automatically gathered" by Facebook.

(Of course, Facebook tries to learn everything about you. The data it gathers is disturbingly extensive...)

This data gets analyzed, scrutinized, often sold or "loaned." It gets run through complex AI algorithms that then spit out more content that you're more likely to engage with. Content can include anything that is connected to Facebook's platform - groups, users, ads, marketplace listings, etc.

In many circumstances, you're not notified of the exact data collected, when it was collected, what exactly is stored about you, and what gets sold off to other companies/advertisers.

Eventually the cycle of AI-recommended content becomes the user being trapped in what has been called a "filter bubble." Again, this is effectively "invisible" for a lot of users, and can be blamed for a lot of the polarization you see on the Internet. Read more about filter bubbles.

Therefore, you can reasonably argue that Facebook is probably the "monopoly" in this post series that benefits the most from the effects of hyper-personalization. Read more about hyper personalization.

Every point of data that Facebook collects is just another avenue for profit. With the extensiveness of Facebook's ecosystem, this effectively reduces even our human-ness and human relationships to mere dollar signs; the content put in front of you becomes what benefits Facebook's bottom line the most, and it's not necessarily who or what you want to connect with.

In addition to this, Facebook has many instances of grossly violating law and even its own privacy policies when it comes to user privacy.

Notable products/services owned by Facebook

Instagram

instagram 2016 logo

Up until April 2012, Instagram was its own independent company. This was in addition to being its own unique and independent social media platform.

Since the $1 billion acquisition, Instagram has been one of the key factors in Facebook's continued relevance and overall growth. The purchase gave Facebook a ton of leverage in developers/talent, and of course, more active users. With the new users, Facebook also gained access to their data; specifically, all that metadata packed into the photos that you upload to the platform.

The purchase of Instagram also squashed a platform that was set up to potentially dominate Facebook in the mobile market share at the time; keep in mind, Facebook was already struggling against the likes of Twitter and Google+ (not defunct). Independent Instagram also had a high engagement rate.

The important thing is to realize that when you're using Instagram, you're using a Facebook service.

Ultimately, this means you are subject to Facebook's abysmal privacy policy, which means you can be certain your privacy is being invaded - you're being tracked, both on the platform and off. This is true even if you don't connect your Facebook account to your Instagram account.

Oculus VR

oculus logo

Oculus produces virtual reality headsets. These headsets are typically used for gaming purposes.

Initially, Facebook's $2 billion purchase of Oculus didn't make much sense to many people. What sense did it make for a social media company to buy a start up specializing in virtual reality gaming, anyway?

Well, it can be argued that Facebook bought Oculus to:

  1. Remain "relevant" among younger users.
  2. Get a leg up in the infancy of the VR (virtual reality) market
  3. Create another source of revenue
  4. Have another substantial source in which to collect even more data from users

It's likely that all of the above points are true. However, you can see point number 4 in action with Facebook's decision to make Facebook accounts mandatory to use Oculus headsets.

Requiring a Facebook account in order to use the headset pretty much gives Facebook "consent" (per their privacy policy) to collect extensive amounts of data without a hitch. Coupled with the fact that Facebook has cracked down on people creating "fake accounts" in recent years by going as far as to require a picture of government ID to verify identities, it's clear that they want to link all data mined straight to you.

WhatsApp

official whatsapp logo

This was another big acquisition made in 2014.

Just before acquiring Oculus, Facebook officially purchased WhatsApp around February of 2014 for $16 billion. Globally, WhatsApp is the most popular mobile messaging platform.

Facebook was still struggling hard on the mobile front. It had been tracking WhatsApp's growth for a long time, and was ultimately concerned that WhatsApp's continued popularity would grow enough to destroy their mobile messenger market share and rival its status as the the top social media network.

Additionally, WhatsApp offers highly personalized one-on-one communication. It has a super high user engagement rate. It helps that WhatsApp gave assurance that message were end-to-end encrypted (E2EE).

Ultimately, this acquisition gave Facebook access to more users - specifically, users in Europe and Latin America. More users across the globe means that it has access to more data (for example, who you're frequently engaging with, what content you may be sharing, from where you're sharing this content from, etc.) while dominating the mobile messenger market.

GIPHY

official giphy logo

In early 2020, Facebook bought GIPHY for $400 million.

GIPHY is a platform for creating and sharing GIFs.

The acquisition doesn't seem like a huge deal, but it does have a privacy impact: GIPHY is the most popular and used GIF-sharing service. What's more significant is that it has many, many calls to its API, even used by services such as Apple's iMessage system.

With GIPHY being used and shared across many different platforms, it makes sense why Facebook acquired it - for the data. Facebook has direct access to what, where, and how users share GIPHY GIFs.

NOTE: This is not an exhaustive list of Facebook's mergers and acquisitions.

Facebook branded services that dominate the web

Facebook (the social media service)

As of Q4 of 2020, Facebook owned approximately 70% of the social media market share.

As you probably already know, Facebook has remained the top social media site for years. As of the end of 2020, it has nearly 2.7 billion active monthly users.

It's estimated that nearly 7 out of every 10 US. adults log into Facebook at least once a day.

Source: StatCounter

Facebook Ads

While Facebook Ads doesn't seem to generate as much revenue for Facebook as Google Ads does for Google, it perhaps generates the most revenue out of all the social media platforms.

Facebook's Ad system has the potential to reach nearly 1.9 billion users. Put into perspective, that is nearly 1/3 of the Earth's adult population.

Facebook Ads is among the top 3 biggest Ad networks on the internet (as of 2020)

Source: Business of apps

With all the above laid out for you, I would hope you would consider the importance of dodging Facebook, and the privacy implications of continuing to use any of its services.

As always, stay safe out there!

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