US regulators probing five tech companies’ acquisitions to 2010

WASHINGTON (AP) – Federal regulators are ramping up their investigation of the market dominance of giant tech companies, demanding detailed information on five companies’ acquisitions of smaller firms back to 2010.

The Federal Trade Commission (FTC) announced the move on Tuesday, issuing orders to Facebook, Amazon, Apple, Microsoft and Google’s parent Alphabet Inc. Hundreds of takeovers of smaller companies are involved.

FTC Chairman Joseph Simons said that as a result of the review, the government may require tech giants to unwind earlier acquisitions and divest their assets if it found violations of antitrust law.

“All of our options are on the table,” Simons said in a conference call with reporters. “If there are some transactions that are problematic, then we have that opportunity and that ability to go back and challenge” them.

Short of requiring divesting pieces of companies, other options could include putting assets into a separate company unit or mandating changes in how the companies conduct business, Simons said. The focus of the review is on acquisitions with a smaller value, about USD100 million or less, that didn’t trigger government reporting requirements for the companies. But Simons said the regulators are interested in tech industry mergers of all sizes. The FTC staff also will look into whether companies may have manipulated the value of some acquisitions to evade the reporting requirements, he said.

The FTC, the Justice Department and a House committee have been investigating the conduct of Facebook, Google, Amazon and Apple, and whether they aggressively bought smaller potential rivals to suppress competition and hurt consumers. Some critics have pointed to Facebook’s acquisition of Instagram and WhatsApp, for example, as deals that should be questioned.

The popular messaging services are among some 70 companies that Facebook has acquired over the past 15 years or so, giving it what critics say is massive market power that has enabled it to snuff out competition.

The Federal Trade Commission building in Washington. PHOTO: AP