EU asks rivals: Is Facebook’s WhatsApp deal a bad idea?

The EU will ask Facebook’s rivals and major telecoms companies if its proposed $19bn bid for WhatsApp is a bad idea before it approves the deal. In a bewildering list of questions the antitrust commission will attempt to work out if Facebook’s acquisition will stifle innovation and lead to price hikes.

Facebook’s deal to buy WhatsApp, the largest in its history, would see it become one of the biggest players in mobile messaging. The EU has set itself a 3 October deadline to approve the deal and has sent an extensive questionnaire to rival firms and telcos.

“If negative, please explain why and what kind of negative impact (for example price increase, deterrence of innovation, etc),” the document asked.

Rival companies were also asked if Facebook owning WhatsApp would have an impact on advertising, the cost of advertising and, crucially, whether normal users would be affected by the deal.

“As a result of the Facebook/WhatsApp transaction, do you expect users of WhatsApp to face greater difficulties in switching to another consumer communications service/app?” the questionnaire read.

Facebook has been given an easier ride in the US with the Federal Trade Commission waving through the deal in April with minimal caveats. Despite the takeover not being large enough to trigger an automatic EU investigation Facebook asked the antitrust commission to look into it.

It isn’t clear why Facebook took this action, although it seems likely that the social networking giant is trying to rubber stamp the deal to avoid any further investigations. Companies have until 8 September to respond to the lengthy questionnaire.