The FTC uses the Consumer Welfare Standard to decide antitrust cases, which means they have to show that a proposed merger would cause tangible harm to consumers. If "reducing competition" was the standard then all buyouts/mergers would be illegal since they all necessarily reduce competition.

It's not "reducing competition", it's "___substantially___ reducing competition". The difference matters.

I have been thinking about this the other day, and I think buyouts and mergers should be illegal.

This doesn't deserve to be downvoted. Competition is crucial for healthy markets, and the only effect of buyouts and mergers is to consolidate business and decrease competition. If Adobe wants Figma's product, then they can do business with Figma and license it from them. Stop normalizing monopolistic behavior.

> the only effect of buyouts and mergers is to consolidate business and decrease competition

Acquisitions also preserve value in businesses that would otherwise shut down (now or are on a path to). They can create a combined business that's better than the sum of its parts. For example, Apple acquiring Next.

Pro-competition / anti-monopoly doesn't require throwing the baby out with the bath water.

I feel like Hacker News probably isn’t the place to see folks upvote against acquisitions.

Did they use the Consumer Welfare Standard to block Visa's acquisition of Plaid? Seems like the main reasoning they used was because it was a strategic buy rather than a financially sound one. (and the finances of this deal pretty much mirror Plaids)

With Lina Khan running the FTC, I definitely expect more scrutiny of this proposal than it would likely have received in the past.

That's what they have used in the past, and are not bound to it. If you read any of Lina Khan's work, it's clear that they'll take a more holistic view of the impact of lack of competition.

That's a good point, it's important to note the current FTC chair is working to change the standards that are used. I'm excited to see how that pans out. I think the lack of antitrust enforcement in recent decades is a really underrated problem in American governance.

Why did you elide the “substantially” clause?

Consumer welfare standard is not a law enacted by Congress its just something a lawyer named Robert Bork that was rejected from the Supreme Court popularized in the 70s. It was pre-internet and couldn’t comprehend platform firms like Amazon that price below cost for years to win a market and kill competition

Consumer welfare is stupid, but all these SAAS rent-seeking makes me feel like you could actually make a case.

How much is this enforced though? Wouldn’t this make most mergers illegal?

I guess it all comes down to who defines what ‘substantially lessen competition” means

The rule of thumb is if there are still at least 3 competitors left in a market, it is not "substantially" lessening competition

The key word is "substantially" - there are plenty other competitors.

There may be "plenty" of other competitors, but I think it's pretty undeniable that Figma is the "up-and-coming" (or maybe it already got there) market leader among "design tools for web design". I also think it's pretty apparent that Adobe knows this and that's why they want to buy them.

This is the exact same pattern as Facebook buying Instagram, and heck the same as some of Adobe's previous acquisitions, where large corporations buy out competitors that could potentially overtake them.

If antitrust means anything it should block these types of acquisitions.

Miro and Canva are really similar to Figma, no ?

Not at all close to the design tool—features like autolayout and performance are significantly better than anyone else on the market.

Both of those are pretty close to FigJam, Figma's. whiteboarding tool. It's a nice tool, but that's not why anyone uses Figma.

Not really, no. Miro is a giant whiteboard/brainstorming tool. Canva is a presentation tool, like Powerpoint. To say they can be used for design is saying that MS Paint or Photoshop can be used to design mockups... sure, but that's not really what they're made for, and it would be a painful experience (even Adobe learned that, eventually, and tried to copy Figma by making the separate Adobe XD tool)

You can try to coerce those other apps to make wireframes & mockups, but Figma is much better for both designers (the layout tools are phenomenal and CSS-like) and devs (the exports are good, there's CSS code to copy, a bunch of plugins, etc.).

I've had various product people try to make mockups in Miro because they didn't want to learn Figma, and it usually ends up being a bunch of screenshots clobbered together. That's a lot harder to work with than being able to click on a particular component in Figma and see its exact color, border radiuses, flexbox layouts, etc., and then to have entire widgets, dashboards, screens, and apps composed out of these components and built into a functional interactive prototype that stakeholders can review and comment on and devs can inspect for technical details. Figma is really really good at that.

If someone tried to send me one in Canva, well, I think I'd just quit right then and there lol. (Don't get me wrong, Canva is a great tool for presentations, but not for sharing designs)

Not... really. Sketch is what is most analogous.

Sketch is perhaps most analogous, but I remember a couple years ago where designers left Sketch in droves to move to the better features of Figma.

If Adobe thought Sketch was a competitive risk, they'd be buying them instead.

Sketch is locked to MacOS which limits its applicability

They have a pure web version.

They don't. The web version is a viewer not an editor.

Interesting. I always thought it was an editor. Given it can preview I’m guessing they’re working towards a web editor too.

Does the FTC even do anything anymore...? I can't remember a single significant enforcement action in my lifetime.

The FTC blocks mergers all the time. Here’s some in the news:

https://khn.org/news/article/biden-ftc-block-hospital-merger...

https://www.airandspaceforces.com/ftc-blocks-merger-of-lockh...

https://www.nasdaq.com/articles/nvidia-and-arm-merger-deal-b...

https://www.housingwire.com/articles/50114-ftc-moves-to-bloc...

https://www.legalbettingonline.com/news/daily-fantasy-sports...

Mostly the FTC’s work happens quietly and unnoticed, but there are annual reports here:

https://www.ftc.gov/policy/reports/annual-competition-report...

And you can search merger actions here:

https://www.ftc.gov/enforcement/merger-review

Are there any significant historical cases? The Nvidia and Arm one seems like a big deal (if it succeeds), but the others just seem like random low-hanging fruit. I feel like the ones that matter (ISPs, cell phone carriers gobbling each other up, the Microsoft/Facebook/Adobes of the world, AMD buying ATI...) never really get stopped.

AT&T/T-Mo blocked:

https://www.justice.gov/opa/pr/justice-department-files-anti...

https://en.wikipedia.org/wiki/Attempted_purchase_of_T-Mobile...

T-Mo/Sprint would have been blocked (and fell apart multiple times) if not for the Trump administration:

https://en.wikipedia.org/wiki/Merger_of_Sprint_Corporation_a...

I think you’re undervaluing the significance of the FTC’s everyday work, but I’ll agree with your the Federal government has not been aggressive enough in exercising its anti-trust authority.

Isn't AT&T/T-Mo a DoJ effort, not the FTC? I don't see the FTC's involvement in your links... were they cooperating behind the scenes somehow?

The Sprint one was also DoJ, according to the wiki.

I get that the FTC on paper is supposed to enforce things like that, but their track record doesn't seem great. It just feels like a zombie agency that used to have teeth a long time ago...

Edit: I guess they've been squabbling for a while: https://www.cnbc.com/2019/09/18/the-ftc-and-doj-are-squabbli... but maybe are trying to work it out? https://www.ftc.gov/news-events/news/press-releases/2022/01/...

Then probably the next Republican president will come along and just got both their efforts all over again...

Ya the last big case was Microsoft. Antitrust is being revived after being mostly dormant for 40 years but Congress has never changed the laws executives and the judiciary have just chosen not to enforce them

Considering the instant response on HN was to upvote the open source competition and the fact many people are probably going to leave to go to a competitor because they hate Adobe. It probably doesn't lessen competition but increases it since a lot of competitors are getting sign ups right now.

The argument "but there are competitors" – that the very existence of other players in a market should preclude the blocking of acquisitions – is flawed and misleading.

For competition to strengthen a space, it needs to be meaningful competition. The goal for regulators should not be "more than one player in every category." It should be diverse product expression, improved customer utility, and most of all ZERO winner-take-all effects.

That last item (winner-take-all) is crucial to understand, and I'm sad that it is no longer a major part of economic discourse (as it once was when systems-thinking was more common). Winner-take-all effects often occur without an explicit monopoly, yet devastate the category and its adjacent categories.

> For competition to strengthen a space, it needs to be meaningful competition.

There are meaningful competitors to Adobe's design tools. There are quite a few applications like Figma with a decent amount of traction. The fact they will be receiving an uptick in users will increase their meaningfulness which means Adobe acquiring Figma is not lessening the competition.

Why do you think that other companies will see an uptick in users from this? Most companies are not going to renegotiate contracts, update all their processes and tools, and retrain all their users just because this got bought by Adobe (which they are probably already paying for other tools). This absolutely reduces competition.

> Why do you think that other companies will see an uptick in users from this?

Because the number of people who are saying "Adobe is going to ruin Figma".

While companies aren't going to renegotitate, freelancers and designers doing personal work will just switch to another freemium tool. And tools end up in the work toolchain by the employees using them and suggesting.

There is probably a triple-digit number of legitimate competitors out there.

For sure not triple digit legitimate competitors. To be legitimate competitor means some very mature software / service. I can think of Sketch and Adobe XD, maybe Balsamiq but not quite the same. What are these 100 extra well formed alternatives?