Facebook Fined Record £50m By UK Competition Watchdog (bbc.co.uk) 15
"The BBC is reporting that Facebook has been fined a record £50 million by the UK's Competition and Markets Authority," writes long-time Slashdot reader Hope Thelps, "for deliberately failing to provide required information" (pertaining to Facebook's 2020 acquisition of Gif-sharing service Giphy).
The BBC reports: The £50m fine the CMA handed Facebook is more than 150 times higher than the previous record handed down for similar offences, at £325,000.
Speaking about its decision to fine the social media giant, the CMA said in a statement: "This is the first time a company has been found by the CMA to have breached an [order] by consciously refusing to report all the required information."
Giphy is widely used by Facebook's competitors to power animated Gif images used in social media apps, on mobile keyboards, and elsewhere online. That led to potential competition concerns. The CMA issued something called an "initial enforcement order", which limits how companies that are merging, but under investigation, operate. It is designed to keep the entities semi-separate and in competition with each other until the investigation is over. Facebook is obliged to provide updates and information to make clear how it is complying with the order.
"Given the multiple warnings it gave Facebook, the CMA considers that Facebook's failure to comply was deliberate," the CMA said.
That "fundamentally undermined its ability to prevent, monitor and put right any issues".
The fine for that offence is £50m. Separately, the CMA announced a £500,000 fine for Facebook changing its chief compliance officer — twice — "without seeking consent first".
The BBC reports: The £50m fine the CMA handed Facebook is more than 150 times higher than the previous record handed down for similar offences, at £325,000.
Speaking about its decision to fine the social media giant, the CMA said in a statement: "This is the first time a company has been found by the CMA to have breached an [order] by consciously refusing to report all the required information."
Giphy is widely used by Facebook's competitors to power animated Gif images used in social media apps, on mobile keyboards, and elsewhere online. That led to potential competition concerns. The CMA issued something called an "initial enforcement order", which limits how companies that are merging, but under investigation, operate. It is designed to keep the entities semi-separate and in competition with each other until the investigation is over. Facebook is obliged to provide updates and information to make clear how it is complying with the order.
"Given the multiple warnings it gave Facebook, the CMA considers that Facebook's failure to comply was deliberate," the CMA said.
That "fundamentally undermined its ability to prevent, monitor and put right any issues".
The fine for that offence is £50m. Separately, the CMA announced a £500,000 fine for Facebook changing its chief compliance officer — twice — "without seeking consent first".
Wake me when they're serious (Score:2)
As long as there isn't nine zeros after the number in the fine, the fined companies will treat them as the joke they are.
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Yeah, I can't see Facebook delaying their plans to destroy the competition because of a little £50 million fine.
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I'm bad at financial stuff but if I researched this correctly, Facebook makes about 10 Billion in profit per year.
I think before they start making fines to be a percentage (like 1% for small things up to 40% for honking big missteps) of actual annual profit, these corporations just wont care... I think I read that Facebook has like 130 Billion laying about... I'm not sure if that's cash or assets but it seems a low number for assets... in light of that these 50 million compare to the change I keep in the ca
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In the UK, Facebook revenue was ~£1.65bn in 2018. Pre-tax profits were ~£97M, so a £50M fine from that would be ~51.5% of pre-tax profits.
What Facebook really should be wary of is GDPR fines from the EU which are calculated on the basis of percentage of global income. What's more, EU leaders, security agencies & corporations have neither love nor loyalty for Facebook unlike in the US & UK.
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In the UK, Facebook revenue was ~£1.65bn in 2018. Pre-tax profits were ~£97M, so a £50M fine from that would be ~51.5% of pre-tax profits.
What Facebook really should be wary of is GDPR fines from the EU which are calculated on the basis of percentage of global income. What's more, EU leaders, security agencies & corporations have neither love nor loyalty for Facebook unlike in the US & UK.
The fine should have been a significant percentage of their global profits from the start. 51.5% of their profits would be more painful if Facebook were only operating within the boundaries of the UK. Facebook is a global company, and the fine levied barely represents half a days worth of profit. At that point, the fine isn't a deterrent but rather just a minor cost of doing business.
Until companies like Facebook are forced to pay debilitating fines when they flagrantly violate the laws of the countries in
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And their share price went up when the fine was announced.
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Really, this link (https://www.cnet.com/tech/mobile/facebooks-massive-outage-costs-the-company-an-estimated-60-million-in-revenue/) notes that they make roughly $13.3Million per hour, so even 50M pounds to dollars is roughly 65Million, so eh a five hour fine?
Fine should be similar to Finland speeding ticket (Score:2)
Most of Scandinavia determines fines based on income
Facebook doesn't care (Score:2)
So: 12.5% (Score:3)
Facebook acquired Giphy for $400 million. So this increases the acquisition price by 12.5%. Not peanuts, but not really significant.
If Facebook deliberately hid information, it was because they believed that a government watchdog would find the acquisition anti-competitive. The actual solution is to force them to disgorge Giphy.
And really, companies the size of Facebook should not be allowed to acquire other companies at all. They are already too big - if anything, they should be forced to divest.
To put that fine into perspective (Score:2)
Facebook makes about 30 billions of profit a year. If Facebook was a normal person, that would mean they make about 2.5 billions a month, with a standard working month, that means that they make about 14 millions an hour. Or, in other words, that fine would be about as much as they make in 4 "work hours".
How serious would you take a fine that costs you about as much as you make in 4 hours?
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What's more, they probably even saved that amount just in admin/legal costs that would've incurred by executing the compliance requests.
How many seconds of revenue? Or less than a second (Score:2)
pathetic (Score:2)