Facebook owns 4 of the top 5 most downloaded apps

Max Zahn
Reporter

New research shows that Facebook (FB) owns four of the five most-downloaded apps on iOS and Android last month — Facebook Messenger, core Facebook, WhatsApp, and Instagram.

The research from Evercore ISI came out on July 10, just about two weeks before Department of Justice officials said they opened a review of antitrust concerns associated with major technology companies.

FILE - In this May 1, 2018, file photo, Facebook CEO Mark Zuckerberg delivers the keynote speech at F8, Facebook's developer conference, in San Jose, Calif. Federal regulators are fining Facebook $5 billion for privacy violations and instituting new oversight and restrictions on its business. But they are only holding Zuckerberg personally responsible in a limited fashion. (AP Photo/Marcio Jose Sanchez, File)

In total, the four high-performing Facebook-owned apps were downloaded 205.86 million times last month, according to the data provided by Evercore ISI.

Facebook released second quarter earnings on Wednesday that bested analyst expectations for revenue and daily active users. The company’s shares rose in after-hours trading, even though Facebook also revealed that the Federal Trade Commission had opened an investigation into the company.

“Facebook is the dominant mobile app publisher,” said Kevin Rippey, a financial analyst at Evercore ISI and co-author of the report. “Nothing we’re seeing on the immediate horizon would suggest these trends will change.”

TikTok, a social media video app popular with young people, was the lone app among the top five not owned by Facebook. In this political climate, the DOJ would not permit Facebook to acquire TikTok, Rippey said.

“Acquisitions of any size will be very challenging going forward,” he added.

Research shows that Facebook owns four of the five most-downloaded apps on iOS and Android last month. (Source: SensorTower, Evercore ISI Research)

‘Not evidence of antitrust behavior’

Rippey said the large presence of Facebook in the app sector does not suggest the company has violated antitrust rules.

“When you think through U.S. antitrust law, market dominance in and of itself is not evidence of antitrust behavior,” Rippey said.

On Wednesday, the federal government made public the resolution of a pair of investigations into the company. Facebook has been fined $5 billion by the FTC to settle an inquiry over the company’s privacy practices, the agency announced on Wednesday.

Another $100 million in charges were levied against Facebook by the SEC over the company’s false representation of when and how it learned of the misuse of its data by political advertising firm Cambridge Analytica.

The research showed that Facebook Messenger was the most-downloaded app on iOS and Android, followed by Facebook-owned WhatsApp and the core Facebook service. Not far behind, Instagram — another property of Facebook — ranked fifth among the most downloaded apps in June.

David Marcus, CEO of Facebook's Calibra digital wallet service, at a House Financial Services Committee hearing on Facebook's proposed cryptocurrency on Capitol Hill in Washington, Wednesday, July 17, 2019. (AP Photo/Andrew Harnik)

‘A chicken and egg question’

“If there’s behavior Facebook is taking to reduce other apps’ ability to grow or scale, other than offering a superior product, that might be of issue,” he added. “To date, we’ve seen nothing to suggest anything of that sort.”

Facebook acquired Instagram for $1 billion in 2012, and purchased WhatsApp for $19 billion two years later. Rippey said these acquisitions did not constitute anticompetitive behavior that should concern the Department of Justice, in part because Instagram and WhatsApp were far smaller when Facebook acquired them.

“It stands to reason that neither of the apps could’ve grown as big as they did as independent entities,” Rippey said. “It’s a little bit of a chicken and egg question.”

Max Zahn is a reporter for Yahoo Finance. Follow him on twitter @MaxZahn_.

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