You can sign up for, and log into, Facebook (FB) without ever having to reach for your wallet. But Roger McNamee, one of the company's first investors, says that while you might not have to pay in cash, you're absolutely paying by turning over your personal data to the social network.
"If you think about it, what's really going on, you're bartering your personal data, for a very useful service," McNamee said in an interview with Yahoo Finance's The Final Round. "And in that context, the currency isn't dollars, it's data."
The investor, however, goes one step further than that. According to McNamee, the price of users' data is only increasing with time, while the quality of Facebook's service has declined. And that, he says, is reason enough for the Department of Justice, the Federal Trade Commission (FTC), and state attorneys general to go after the company for antitrust violations.
Data instead of dollars
In its most recent earnings report, Facebook saw revenue of $21.08 billion, with revenue per user coming in at $8.52. In the same quarter last year the company made $16.91 billion in revenue with average revenue per user coming in at $7.37. That revenue per user metric is a measure of how much cash the company was able to pull in via advertisements per user.
But McNamee, a frequent Facebook critic and author of the book "Zucked: Waking Up to the Facebook Catastrophe," says that Facebook's services have faltered in recent years, as user data becomes more important for companies around the world.
As a result, he says the company is making more, in data, while offering a worse product due to privacy controversies including the Cambridge Analytica scandal, which saw a political consulting firm abuse Facebook user data to aid in the election of Donald Trump.
And that, McNamee claims is directly harming consumers.
"And the consequence of that is, even under today's antitrust law, these guys are committing a violation," McNamee said. "They are committing consumer harm, because the price has been going up a lot. And so we are trying to get the antitrust division of the justice department the FTC, and state attorneys general to take that model and go after these guys."
McNamee and his VC firm, which he co-founded with none other than U2's Bono, were among the early investors in Facebook. And despite his criticism, Elevation Partners still holds a stake in the social network. McNamee himself also continues to hold Facebook stock, though he says he has pared back his position over time.
Taking fire from all sides
It's not just McNamee who believes Facebook should face a reckoning from regulators. A number of hopefuls seeking the democratic nomination for the 2020 presidential election have said that the company should either be investigated for antitrust violations, or be broken up.
Senator Elizabeth Warren (D-MA), in particular, has pushed for Facebook to be forced to unwind its acquisitions of Instagram and WhatsApp. She's also taken aim at the likes of Google, Amazon, and Apple.
Facebook is already staring down antitrust investigations by both the FTC and DOJ, and McNamee is just one more voice urging an antitrust crackdown.
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