Facebook’s $1bn bid for photo-sharing platform Instagram is to be investigated by the Office of Fair Trading, which has expressed concern that the social network might restrict both Instagram and rivals’ abilities to compete in the marketplace.
The OFT believes there is a risk Facebook might stop Instagram from uploading photos to other social networking websites, or restrict other apps’ access to Facebook.
Companies likely to be affected have been invited to share their views by the 5 July. The OFT’s first task will be determining if it has jurisdiction over the deal. If so, whether the investigation goes ahead or not will determine on whether the OFT learns of any possible harmful effects.
But the OFT isn’t investigating the bid alone. In the US, the Federal Trade Commission is asking the same questions.
Facebook has said it is prepared to “work closely” with the OFT, and that it “looks forward to answering any questions that arise”.