The Under-The-Radar Senate Hearing More Meaningful To Facebook Than Zuckerberg Grilling

Facebook, Inc. FB CEO Mark Zuckerberg’s Congressional hearing drove a 3.6-percent rally in the suffering stock over the last two sessions.

But that 10-hour interrogation and anything revealed or resolved in the process had fewer near-term implications for Facebook than a quieter, one-hour meeting held Tuesday evening, according to Height Capital Markets.

What Happened

Following its grilling of Zuckerberg, the Senate Commerce Committee hosted a nomination hearing for the final pending commissioner to the Federal Trade Commission.

“The biggest near-term regulatory risk in the U.S. for Facebook stems from an FTC investigation, but the Senate has yet to confirm any of its five pending nominees,” Height's Stefanie Miller wrote in a Thursday note.

The committee made progress with Tuesday’s questioning. Miller expects the Senate to fill all five vacancies before the recess at the end of April, which would allow the FTC to complete a six-month investigation into Facebook some time in the fourth quarter of 2018.

Why It's Important

If all goes as planned, the Senate will appoint three Republicans and two Democrats to the commission. One left-leaning nominee, Rebecca Kelly Slaughter, is expected to push for particularly tough regulation and penalties for Facebook.

“We continue to expect the FTC will ultimately require Facebook to pay a $1-2 billion fine and agree to a revised and likely more burdensome consent decree,” Miller wrote.

Facebook was trading around $164.76 at time of publication.

Related Links:

Facebook CEO Mark Zuckerberg On Data Privacy: 'My Mistake'

How Valuable Is Your Facebook Data? Less Than You Think