When Antitrust Met Facebook
![handle is hein.journals/gmlr19 and id is 1161 raw text is: 2012]
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WHEN ANTITRUST MET FACEBOOK
Christopher S. Yoo'
INTRODUCTION
Social networks are among the hottest phenomena on the Internet. Fa-
cebook eclipsed Google as the most visited website in both 2010 and 2011.'
Moreover, according to Nielsen estimates, as of the end of 2011 the average
American spent nearly seven hours per month on Facebook, which is more
time than they spent on Google, Yahoo!, YouTube, Microsoft, and Wikipe-
dia combined.2 LinkedIn's May 19, 2011 initial public offering (IPO)
surpassed expectations, placing the value of the company at nearly $9 bil-
lion,' and approximately a year later, its stock price had risen another 20
percent.' Facebook followed suit a year later with an IPO that placed the
value of the company at over $100 billion.' Other social networking sites
remain hot properties, and other Internet companies are struggling to catch
up.
In what may be considered a rite of passage previously faced by such
high-tech giants as IBM, AT&T, Microsoft, and most recently Google, so-
cial networking companies are now facing increasing scrutiny under the
antitrust laws.' Early private antitrust cases have begun to appear.'
John H. Chestnut Professor of Law, Communication, and Computer & Information Science and
Founding Director of the Center for Technology, Innovation & Competition, University of Pennsylva-
nia. The author would like to thank the Milton and Miriam Handler Foundation for its financial support
for this project.
1 Press Release, Experian Hitwise, Facebook Was the Top Search Term for Third Straight Year
(Dec. 21, 2011), available at http://www.experian.com/hitwise/press-release-facebook-was-the-top-
search-term-for-201 I.html.
2 December 2011-Top U.S. Web Brands, NIELSEN WIRE (Jan. 25, 2012), http://blog.nielsen.
com/nielsenwire/online mobile/december-201 1-top-u-s-web-brands.
3 Stu Woo et al., Linkedin IPO Soars, Feeding Web Boom, WALL ST. J., May 20,2011, at Al.
4 Compare id (showing Linkedln stock at $94.25 after its first day of trading, May 19, 2011),
with LinkedIn Corp.: Historical Prices, GOOGLE FIN., http://www.google.com/finance/
historicql?q=NYSE:LNKD (last visited July 8, 2012) (reporting that LinkedIn's stock closed at $113.49
on May 16, 2012, about one year after its IPO).
5 Jessica Guynn, Facebook's Future Rests on Founder, L.A. TIMEs, Feb. 3, 2012, at BI. But see
Andrew Bary, Facebook Flops: Look Out Below!, BARRONS.COM (May 19, 2012), http://online.bar
rons.com/article/SB50001424053111904571704577410421435718852.html (explaining that Facebook
achieved a $100-plus billion market value with its May 18, 2012 IP0, but noting that the lack of a
big 'pop' for the stock during initial trading suggests this valuation may fizzle over time).
6 See Amir Efrati, Antitrust Regulator Makes Twitter Inquiries, WALL ST. J., July 1, 2011, at B3;
Jia Lynn Yang, Dangerous Waters? Facebook's Link to Online Games Has Some Charging the Social
Network Has Waded into Antitrust Territory, DAILY HERALD (Chi.), June 30, 2011, § 3, at 1; J. Thomas](ViewImageLocal?handle=hein.journals/gmlr19&div=49&collection=&method=preview&ext=.png&size=3)
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