Of course, unlike the telecom industry, there are no regulatory barriers to entry in these ecosystems. But all these three apps have the property of what economists’ call “network externality”.
For most products, utility does not depend on others using it too. But in products like say, a fax machine or a multi-player game, the more users there are, the more useful the product becomes to everyone.
This applies to social media platforms – the more active users there are of Facebook, WhatsApp and Instagram, the greater the usefulness. So at some point, it will become practically impossible for new entrants to become serious competitors as they will have to grow that entire network of users from scratch to capitalise on this externality.
Many businesses rely on one or more of this trio of apps for their livelihoods too. In countries like Myanmar, Facebook is the main app for e-commerce.
WhatsApp is used by some businesses, even in Singapore, as the primary order placement platform. Many companies use their Instagram or Facebook page as their default and sometimes, only, website.
There are alternatives to each of these applications. There is a host of messenger applications, numerous social media networks, and photo-based sharing websites and applications such as Tumblr or Pinterest.
Yet, these three apps have dominated the world of social media. Should one company be allowed to operate all these three applications? The disruption of these services apart, the tremendous amount of data that these three software services generate at the individual level makes Facebook a very powerful corporation which may well deter competition and pose serious threats to consumer privacy concerns.
The outage highlights these anti-trust issues in a very real way to governments around the world. Indeed, one can argue that governments too are directly affected.
Without that instantaneous ability to reach an audience of millions, the work of politicians, influencers, non-profits and businesses can be damaged irreparably. Many of them have built their business and messaging on a social media platform, and their livelihoods can be strangled when access is cut off because of an outage.
Imagine a disruption to WhatsApp in the days immediately preceding an election. Those days of campaigning are often critical to increasing turnout on election day, not to mention the operational demands of organising an election.
Facebook’s outage only heightens concerns about other monopoly like services like Google for search, LinkedIn for professional networking and job search, and Twitter for its ability to organise mass movements.