Instagrim deal
F’book probe stirs Post hot doc talk
The Federal Trade Commission is probing whether Facebook snapped up companies like Instagram in order to squash up-and-coming rivals, according to a new report.
The FTC has been reaching out to founders of companies Facebook purchased to learn whether CEO Mark Zuckerberg has been eliminating threats through acquisition, The Wall Street Journal reported Thursday.
That jibes with The Post’s reporting earlier this year revealing that a high-ranking Facebook executive said at the time of the $1 billion acquisition of Instagram that the purchase would serve to eliminate a potential competitor. The FTC got a hold of that executive’s statement in 2012 before the merger was completed.
Then-FTC Chairman Jon Leibowitz used the statement in a lawsuit contesting the hookup, which is now widely viewed as one of the most successful tech mergers in history, two sources with close knowledge of the deliberations told The Post.
But the deal went through when Leibowitz failed to generate enough support from his fellow commissioners, sources said.
“It was a spectacular document,” one source said of the document, declining to say whether Zuckerberg himself had written it.
Facebook argued for the deal by claiming that Instagram was a stand-alone photo-sharing site for smartphones — not a social networking site. Today, Instagram represents much of Facebook’s social network market share growth.
“That document will be important,” a former FTC official said, speaking of the current investigation. “It makes it a lot easier to bring a case when you have that kind of document.”
Still, the former FTC official gave the current FTC a less than 50 percent chance of filing suit against Facebook now that the deal is complete.
If it sues, the FTC could force Facebook to make it easier for competitors to launch social networking sites or even to spin off Instagram into a separate company. .
The FTC declined to comment.