Facebook’s recent $5 settlement with the FTC could be seen in two ways. On one side, $5 billion is indeed a lot of money; on the other, it pales in comparison to the company’s revenue in 2018, which reached $55 billion – 11 times the amount of the fine.
It might not be enough to deter a big tech firm from using the same – or even more refined – techniques they use to extend their reach and monopolize, generating tremendous profits in the process.
But the FTC is limited in its ability to penalize businesses by existing laws. This is why a group of Democratic senators is introducing a bill that could modify legislation to allow the FTC to squeeze out more money from bad actors.
The proposed bill simply aims at deterring monopolistic behavior by imposing huge fines on the companies that are found doing this. Companies will pay the largest sum between 15% of their annual revenue or 30% of the revenues generated during the period of misconduct.
The bill was introduced by Senators Amy Klobuchar (Minnesota) and Richard Blumenthal (Connecticut) and was co-sponsored by Senators Dianne Feinstein (California) and Ed Markey (Massachusetts).
“We have a major monopoly problem in this country: dominant companies need to be put on notice that there will be serious financial consequences for illegal monopolistic behavior,” Klobuchar said.
Big tech seems to be the main perpetrator of such kind of behavior in current times. The House launched in June a bipartisan antitrust investigation into big tech.
In July, the DoJ confirmed it was investigating into “search, social media, and some online retail services”, possibly alluding to Google, Facebook and Amazon.
The same week, Facebook said it was the target of another investigation by the FTC, separate from the probes into its privacy practices.
Bills can take a lot of time to become laws, but when this one will be, any violation could prove expensive for big tech.