Report: Zuckerberg’s Thoughts On Facebook’s Current Monopoly Status

• Mark Zuckerberg was asked to comment on the monopoly status of Facebook when he was testifying in front of the joint session between the Senate Judiciary and Commerce committees.
• The Facebook CEO first tried to tackle the question by saying that there are other companies with which their services do overlap, but ultimately stated that, "It certainly doesn’t feel like that to me," denying Facebook's monopoly.
• Finally, at the end of this exchange, Zuckerberg did mention that he welcomes new regulatory changes, explicitly citing, "if it’s the right regulation, yes."

Mark Zuckerberg was held before a joint session between the Senate Judiciary and Commerce committees today. The Facebook CEO was asked to comment on the company’s monopoly status, something which has surfaced a number of times in the previous year with mentions of breaking up the company.

Senator Lindsey Graham (R-SC), was the first person who brought up this issue. The conversation started out with Graham asking Zuckerberg, “Who’s your biggest competitor?” Perhaps the CEO understood where this discussion was headed, so with noticeable hesitation, he made a statement that companies such as Google, Apple, Amazon, and Microsoft provide services that “overlap” with Facebook in many different ways.

The senator proceeded to break down the question with an analogy from the automobile industry. “If I buy a Ford, and it doesn’t work well, and I don’t like it, I can buy a Chevy. If I’m upset with Facebook, what’s the equivalent product I can go sign up for?” Graham inquired. The answer from Zuckerberg again saw the CEO breaking down the company’s different services to which the senator reiterated the question.

“I’m not talking about categories. I’m talking about the real competition you face. ‘Cause car companies face a lot of competition. They make a defective car, it gets out in the world, people stop buying that car, they buy another one. Is there an alternative to Facebook in the private sector?” The Senator asked again.

Zuckerberg this time went on to elaborate that they provide different services and some of their services do overlap with other service providers. He went on to state how the average American uses eight different types of app for social communications and so on.

The Senator then asked if Zuckerberg thought Twitter was a Facebook alternative, but here too, the CEO refers that the two services “overlap” on certain categories. Since this measure was turning out to be a wild-goose chase, Graham simply laid out the question, “You don’t think you have a monopoly?” Zuckerberg replied, “it certainly doesn’t feel like that to me.” The remark was followed up by laughter from all people present.

There was also talks about GDPR. Here is a transcript of the conversation that took place related to Facebook’s monopoly status:

Sen. Graham: Who’s your biggest competitor?

Zuckerberg: Uh, senator, we have a lot of competitors.

Sen. Graham: Who’s your biggest?

Zuckerberg: The categories… do you want just one? I am not sure I can give one but can I give a bunch? There are three categories that I would focus on. One is the other tech platforms: Google, Apple, Amazon, Microsoft, we overlap with them in different ways.

Sen. Graham: Do they provide the same service you provide?

Zuckerberg: In different ways.

Sen. Graham: Let me put it this way. If I buy a Ford, and it doesn’t work well, and I don’t like it, I can buy a Chevy. If I’m upset with Facebook, what’s the equivalent product I can go sign up for?

Zuckerberg: Well, the second category I was going to talk about…

Sen. Graham: I’m not talking about categories. I’m talking about the real competition you face. ‘Cause car companies face a lot of competition. They make a defective car, it gets out in the world, people stop buying that car, they buy another one. Is there an alternative to Facebook in the private sector?

Zuckerberg: The average American uses eight different apps to communicate with their friends and stay in touch with people ranging from text to email—

Sen. Graham: Which is the same service you provide?

Zuckerberg: Well, we provide a number of different services.

Sen. Graham: Is Twitter the same as what you do?

Zuckerberg: It overlaps with a portion of what we do.

Sen. Graham: You don’t think you have a monopoly?

Zuckerberg: It certainly doesn’t feel like that to me.

[laughter]

Sen. Graham: Instagram. So you bought Instagram. Why did you buy Instagram?

Zuckerberg: Because they were very talented app developers who are making good use of our platform and understood our values…

Sen. Graham: Is a good business decision. My point is: one way to regulate a company is through competition, through government regulation. Here’s my question, what do we tell our constituents, given what’s happened here, why we should let you self-regulate? What would you tell people in South Carolina, given all that’s happened here, why it would be a good idea for us to let you regulate your own business practices?

Zuckerberg: … well, Senator, my position is not that there should be no regulation…. I think the internet is becoming —

Sen. Graham: Do you embrace regulation?

Zuckerberg: I think the real question, as the internet becomes more important in people’s lives, is what is the right regulation —

Sen. Graham: Do you as a company welcome regulation?

Zuckerberg: If it’s the right regulation, yes.

Sen. Graham: Do you think the Europeans have it right?

Zuckerberg: I think that they get... things... right.

[laughter]