How Facebook Knew About Snap's Struggles Months Before the PublicThe news underscores just how hard it is for upstarts to challenge Facebook's dominant position.

ByJon Fingas

This story originally appeared onEngadget

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You may have only recently discovered thatSnap isn't having much luckattracting new users, but Facebook knew months before -- and there's a chance you helped it find out.

TheWall Street Journalhaslearnedjust how Facebook has been using app usage data from Onavo Protect, the VPN-based security app fromits Onavo team, to see how Snapchat adoption has changed over time. The social network looked at aggregated info about the frequency and duration of app use to determine that Snapchat use slowed down soon after Snapchat-likeInstagram Storiesbecame available. In other words, Facebook knew it could double down on its anti-Snap strategy within just a few months.

This isn't the first time Facebook has used Onavo's app usage data to make major decisions. The info reportedly influenced the decision tobuy WhatsApp, as Facebook knew that WhatsApp's dominance in some areas (99 percent of Android phones in Spain had it) could cut it out of the loop. Likewise, itadded live videoafter seeing how people usedMeerkatandPeriscope.

To be clear, Facebook isn't grabbing this data behind anyone's back. The company says Onavo Protect is explicit about what info it's collecting and how it's used, and that apps have incorporated market research services like this "for years." The odds are slim that many people read these disclosures before using Protect, but anyone who was concerned could have found them. The revelation here is more abouthowFacebook uses that information rather than the collection itself.

All the same, it's that collection that has some observers nervous. Former Federal Trade Commission CTO Askhan Soltani tells theWSJthat Facebook is turning customers' own data against them by using it to snuff out competitors. Meanwhile, tech lawyer Adam Shevell is concerned that Facebook might be violating Apple's App Store rules by collecting data that isn't directly relevant to app use or ads. Apple isn't commenting on whether or not it is.

No matter what, the news underscores just how hard it is for upstarts to challengeFacebook's dominant position. How do you compete with an internet giant that can counter your app's features (or simply buy your company) the moment it becomes popular? This doesn't make Facebook immune to competition, but app makers definitely can't assume that they'll catch the firm off-guard.

Jon Fingas is an associate editor at Engadget.

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