Question

what an acquisition or merger that was ultimately blocked by US antitrust authorities. Give your opinion regarding the outcome taking the viewpoint of the companies involved and of society at large.

Answer 1

In order for the FTC to find an anti trust issue, the proposed merger must violate of the following four federal laws:

1.   The Sherman Act (The Sherman Act outlaws "every contract, combination, or conspiracy in restraint of trade," and any "monopolization, attempted monopolization, or conspiracy or combination to monopolize." Long ago, the Supreme Court decided that the Sherman Act does not prohibit every restraint of trade, only those that are unreasonable.)

The purchase of Google by Facebook does not create a monopoly on Social Media. I believe this is because Social Media as a concept is largely undefined, in the context of Facebook I see the purchase as an addition to their product offering to retain existing user base.

2. The Clayton Act (The Clayton Act addresses specific practices that the Sherman Act does not clearly prohibit, such as mergers and interlocking directorates (that is, the same person making business decisions for competing companies). Section 7 of the Clayton Act prohibits mergers and acquisitions where the effect "may be substantially to lessen competition, or to tend to create a monopoly.").

The purchase of Google by Facebook does not lessen competition in social media. Facebook does not charge money for its user base to use Facebook; the company makes its money by passthrough AD revenues. As stated above, I see the purchase as an addition to their product offering to retain existing user base.

3. The Robinson-Patman Act of 1936(bans certain discriminatory prices, services, and allowances in dealings between merchants. Also colloquially known as anti price fixing.)

The purchase of Google by Facebook does not create pricing collusion between two parties as Instagram is an unrelated service to Facebook. Facebook does not charge money for its user base to use Facebook; the company makes its money by passthrough AD revenues. As stated above, I see the purchase as an addition to their product offering to retain existing user base.

4. The Hart-Scott-Rodino Antitrust Improvements Act (require companies planning large mergers or acquisitions to notify the government of their plans in advance.)

This point is irrelevant to the argument, if this had not been in compliance the merger would have been blocked already.

I don't think any of these apply as there are more than enough examples of social media companies that exist and are successful at their business.