EU clears Facebook buyout of Kustomer

The EU on Thursday cleared Facebook's acquisition of Kustomer, a customer service technology, under the condition that rivals maintain unfettered access to the platform.

Facebook, now known as Meta, in 2020 announced its purchase of Kustomer, a then five-year-old US company that provides special software that allows businesses to manage within one tool customer interactions by phone, email, text messages, WhatsApp, Messenger and Instagram.

The commission, which runs the EU's powerful antitrust authority, was asked by 10 national authorities to carry out the investigation, with Austria making the original demand.

The commission on Thursday gave its approval but with strict demands, including the nomination of an outside trustee who would ensure that Meta sticks to its promises.

"Our decision today will ensure that innovative rivals and new entrants in the customer relationship management (CRM) software market can effectively compete," said EU Competition Chief Margrethe Vestager in a statement.

"The commitments offered by Meta ensure that its rivals will continue to have free and comparable access to Meta's important messaging channels," she said.

The transaction was below the EU's usual financial threshold for merger investigations, but the commission has become extra vigilant over Big Tech's appetite for startups and how it could harm competition.

Financial terms of the deal were not disclosed.

The acquisition of Kustomer raised red flags, coming as Meta continues a major push to link e-commerce services to its platforms, particularly its WhatsApp and Messenger messaging services.

Of particular concern was Kustomer's popular "chat bot" technology, a customer dialogue channel used by banks, medical offices and airlines where users pump in sensitive information.

"We are pleased with the European Commission's Kustomer merger clearance. It shows that our acquisition of Kustomer will create more choice in the competitive CRM market," a Meta spokesperson said.

Google recently also saw unusually close scrutiny for its purchase of wearables company Fitbit and was forced to make assurances on data use in order to win the green light from Brussels.

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