Facebook stock takes a beating on report that the FTC might thwart its grand unification plans

News that regulators might do some significant regulating quickly sent Facebook investors into a mild panic on Thursday afternoon.

According to an anonymously sourced report by the Wall Street Journal, the Federal Trade Commission is “considering seeking a preliminary injunction against Facebook.” The move could get in the way of Facebook’s big plans to tie its messaging services together—if the story pans out.

Following the report, investors drove Facebook’s stock price down by around 3.5%. Reached by Fast Company, the FTC declined to comment on the report, and Facebook has not yet responded to a request for comment. The FTC could decide to take action “as soon as next month,” according to the WSJ report. And if it does, the agency could prevent Facebook from further integrating the apps it has acquired over the years, most notably Instagram and WhatsApp.

Word that Facebook could link Instagram, WhatsApp, and Messenger broke in January. At the time, Facebook told The New York Times it was “working on making more of our messaging products end-to-end encrypted and considering ways to make it easier to reach friends and family across networks”—a reported goal of Facebook’s unprecedented merger. In January, Democratic Congressman Ro Khanna, who represents the part of California that includes much of Silicon Valley, reacted to the news by saying it’s “why there should have been far more scrutiny during Facebook’s acquisitions of Instagram and WhatsApp[,] which now clearly seem like horizontal mergers that should have triggered antitrust scrutiny.”

Barring unheard-of effort from regulators in the tech industry, you could argue the damage is done. Facebook already controls some of the most important communication services on the planet. But the FTC’s reported deliberations suggest that Facebook could entrench itself further—transforming apps like WhatsApp and Instagram into a monolithic messaging service and shutting out the competition—unless regulators step in.