The Federal Trade Commission (FTC) is nearing the end of its witness testimony in the antitrust trial against Meta, focusing on the acquisitions of Instagram and WhatsApp. The FTC alleges that Meta illegally established a social network monopoly by acquiring these potential rivals rather than competing with them. Meta is preparing to mount its defense, arguing that the acquisitions were beneficial for users and that the company faces robust competition. The outcome of this trial could have significant consequences, potentially forcing Meta to divest Instagram and WhatsApp.
The FTC's central argument is that Meta employed a "buy or bury" strategy, eliminating competitive threats by acquiring them. The FTC contends that Meta's purchase of Instagram for $1 billion in 2012 and WhatsApp for $19 billion in 2014 were strategic moves to suppress competition and maintain its dominant position in the social media market. To support this claim, the FTC has presented internal emails from Meta CEO Mark Zuckerberg, including one where he described Instagram's rise as "really scary" and suggested acquiring the platform to "neutralize a potential competitor". FTC attorney Daniel Matheson argued that Meta chose to buy out rivals instead of competing. The FTC believes that the only way to restore competition is to force Meta to spin off Instagram and WhatsApp into separate companies.
Meta defends its acquisitions by asserting that they were innovation-driven and improved user experience. Zuckerberg testified that Instagram and WhatsApp were small startups at the time of acquisition, and Meta's investments helped them grow into global platforms. Meta's legal team also argues that the company faces strong competition from platforms like TikTok, YouTube, Snap, and iMessage. They maintain that Meta's apps remain free and that market dominance does not equate to an illegal monopoly. Meta's attorney, Mark Hansen, stated that Meta "acquired Instagram and WhatsApp to improve and grow them alongside Facebook". Meta also emphasizes that regulators approved the acquisitions of Instagram and WhatsApp at the time. A Meta spokesperson stated that the FTC's action "sends the message that no deal is ever truly final," as the FTC had reviewed and cleared the acquisitions more than 10 years prior.
During the trial, Meta's Chief Marketing Officer, Alex Schultz, testified about the resources and expertise Meta provided to Instagram after the acquisition. He noted that Instagram co-founder Kevin Systrom had significant autonomy for several years post-acquisition. Schultz also argued that advancements in AI have diminished the importance of social graphs in creating competitive social apps. Zuckerberg faced questioning about his motivations for acquiring Instagram, with the FTC presenting a 2012 email exchange where he discussed "neutralizing a competitor". Zuckerberg explained that Instagram had a superior camera, filter, and overall user experience, making it a worthwhile acquisition.
The trial, which commenced on April 14, 2025, is expected to last for at least eight weeks. The FTC must prove that Meta monopolizes the personal social networking market and that this alleged monopolization harms competition. Legal experts suggest that the FTC faces an uphill battle, as there is more competition in the social networking space compared to online search.
