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Facebook let Netflix see user DMs, was planning to start own streaming service, claims lawsuit

A lawsuit has revealed that in what may be the single biggest breach of public trust by Mark Zuckerberg-led Meta, Facebook let Netflix see users’ DMs to help them better program content.

In a startling revelation, court documents unsealed in an ongoing antitrust lawsuit against Meta, formerly known as Facebook, have exposed the intricate relationship between the social media giant and streaming behemoth Netflix.

The documents suggest that Meta’s decision to discontinue original shows on its platform, notably Jada Pinkett Smith’s Red Table Talk, may have been influenced by its partnership with Netflix, one of its major advertising customers, as reported by Gizmodo and Ars Technica.

Meta’s streaming business, once considered a potential rival to industry giants like YouTube and Netflix, now appears defunct. Last April, Meta announced its withdrawal of support for original shows on Facebook Watch, effectively discontinuing its video-streaming ambitions. This move came amidst cost-cutting measures at Meta, including layoffs.

However, recent filings in the antitrust lawsuit against Meta allege a deeper motive behind the demise of its streaming venture. The documents suggest that Meta curtailed its streaming aspirations to appease Netflix, a significant ad spender on its platform. A letter filed as part of the lawsuit calls for Netflix’s founder and former CEO, Reed Hastings, to provide documents relevant to the case, indicating a close collaboration between the two companies.

The lawsuit, initially filed by Meta customers, accuses the tech giant of anti-competitive practices detrimental to social media competition and consumers. While the initial complaint mentioned secretive agreements between Meta and Netflix, the unsealed documents shed further light on the extent of their collaboration.

According to the filings, Netflix’s substantial advertising expenditure on Facebook fostered a strong relationship. Hastings allegedly played a pivotal role in negotiations to stifle competition in the streaming video market.

Questions arise about why Meta would allow Netflix to influence such a significant business decision. The documents suggest a lucrative partnership between the two companies, with Meta allegedly granting Netflix access to users’ private messages — a claim that Meta has not directly addressed.

Meta’s streaming ambitions, symbolized by Facebook Watch, never achieved the success of platforms like Netflix or Amazon Prime Video. Despite initial efforts to produce original content and secure broadcasting rights for sports events like MLB games, Facebook Watch failed to gain traction in the crowded streaming landscape.

The unsealed court documents reveal discussions within Meta about substantial investments in original programming, including scripted shows and shorter episodes. These discussions reportedly occurred while Hastings served on Meta’s board of directors, raising concerns about conflicts of interest and potential collusion.

A pivotal moment occurred at the 2017 Recode conference when Hastings downplayed the competition between Netflix and Facebook, only to express regrets later in an email to Meta executives. The plaintiffs allege that Meta’s then-COO, Sheryl Sandberg, and Hastings engaged in carefully orchestrated discussions to deflect attention from their companies’ direct competition in the video streaming market.

As the antitrust lawsuit unfolds, revelations from the unsealed court documents offer a glimpse into the complex dynamics between tech giants and streaming platforms. They highlight the potential ramifications of corporate collaborations on market competition and consumer choice.

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