On the EU watchdog’s radar – will Facebook Home be the new Internet Explorer?

An article on TechCrunch discusses the question, whether or not it would be good for a company to provide the default program or app on a mobile device? The bone of contention: Facebook Home. How about the legal aspects of such a “monopoly” position under European competition law?

As we know, the European Commission recently imposed a € 561 million fine on Microsoft for not implementing a screen for its Windows users, where they could choose their preferred web browser. In the eyes of the Commission’s Vice President in charge, Joaquín Almunia, the company did not comply with a legally binding from December 2009. Back then, Microsoft committed itself for 5 years to offer Windows users a “choice screen”, after competition concerns were raised and investigations related to the tying of Microsoft’s web browser, Internet Explorer, to its dominant client PC operating system Windows took place. Could Facebook also get on the radar of the EU competition watchdogs?

The abuse of a dominant position
Article 102 of the Treaty on the Functioning of the European Union (The Treaty), which is directly applicable in all Member States, prohibits the abuse of a dominant position within the internal market or in a substantial part of it, in so far as it may affect trade.

In case of the Internet Explorer, the abuse of a dominant position by Microsoft was seen in the tying of the Internet Explorer to Windows. In the EU Commission’s view, this offered Microsoft an artificial distribution advantage not related to the merits of its product on more than 90 per cent of personal computers. It also would be hindering innovation in the market and would be creating artificial incentives for software developers and content providers (see Article 102 lit b) of The Treaty, „limiting production, markets or technical development to the prejudice of consumers“).

Four reasons, why Facebook Home is far from abusing a dominant position
1. Home is right now just kind of (but still a bit more, than) a single app. Yes, on the new HTC First it will be installed by default. But as far as we know right now, just a simple swipe down is needed and users will return to their basic home screen, with all other apps available. This way of avoiding Home seems much easier, than avoiding the default setting of a web browser of an operating system.

2. Right now (and probably the near future) there is no kind of monopoly, tying text messaging or calling other people on a HTC phone to Home. Users still will have the freedom of choice, using the text messaging system of HTC itself or using another app. And as Home will not (yet) be the operating system, users will easily and, most importantly, without any suffering of disadvantages, be able to use other apps for the same purposes as they would use for example Facebook messenger.

3. Technical development will not be heavily affected by Home. One could draw another image, if Home would be used as a kind of gateway, where all other apps would have to pass through (and would have to be compatible with Home). But other companies and app developers still will have the possibility to create and distribute apps, especially for a specific use (one could think of WhatsAPP or Twitter), which will be used by Facebook Home users. In fact, technical development could easily get a boost by new features, such as Home. Many other companies will try to copy or at least imitate the style of user-centric development. Who nows which company will provide the default screen for mobile phones in 5 years?

4. Even if Home would get the new operating system and even if the free choice of another text messaging app or video-call app would be made very difficult or nearly impossible, still HTC phones don’t represent a „Microsoft-position“ of 90 per cent of personal computers for the European mobile phone market. Especially thinking of Apple, it seems somehow unrealistic that there will be a default Home on an iPhone.

It’s true that Home was a good choice by Facebook to get closer to the people and perhaps this feature can again rise attractivity in the struggling user group of teenagers. For now, the social media giant won’t have to bother whether being observed by EU competition supervisors or not for building a monopoly with Home. At least,  for now.

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