FTC settlement gives Facebook leverage over competitors

Posted in: Legal & Security at 01/02/2012 16:01

Before its initial public offering, Facebook needed to clear a major hurdle: an investigation by federal regulators over its privacy practices.

It did so by agreeing to a settlement with the Federal Trade Commission that experts say came with a double bonus: spooking potential rivals.

Now, as Facebook is preparing to file papers for a massive stock offering this week, its recent agreement with the FTC may help protect its dominance by discouraging competitors from launching social networks of their own, analysts say.

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