This Week in Tech: A Glimpse into Meta’s Antitrust Clash with the FTC

This week, the public is afforded a unique insight into Meta and Facebook as the Federal Trade Commission’s (FTC) antitrust trial against the technology behemoth formally begins.

On Monday and Tuesday, Meta’s CEO and founder Mark Zuckerberg took to the witness stand as the U.S. government presented its case, claiming that Meta runs an unlawful monopoly in the social media arena. The FTC argues that Facebook has systematically crushed competition through significant acquisitions—specifically Instagram in 2012 and WhatsApp in 2014—and by enforcing strict conditions on developers.

Conversely, Meta contends that the social media market is incredibly competitive and asserts that it has played a pivotal role in transforming Instagram and WhatsApp into the global powerhouses they are now.

This trial, which has been years in the making since the FTC initiated its investigation in 2019, has already revealed surprising insights into Meta’s internal strategies and the company’s perceptions of its competitors. Below are some of the key revelations thus far.

Zuckerberg Viewed Instagram as a Significant Competitor

Prior to Facebook acquiring Instagram for $1 billion in 2012, Zuckerberg regarded the photo-sharing application as a formidable rival. Internal messages from that period reflect Zuckerberg’s concerns over Instagram’s swift growth and appeal—even among Facebook staff.

“They seem to possess two advantages we lack: an exceptional camera and a photo-focused sharing platform,” Zuckerberg communicated via email. He also expressed worries that a larger contender, such as Google, could purchase Instagram and leverage it to undermine Facebook’s supremacy.

“If Instagram keeps excelling on mobile or if Google acquires them, they could easily implement features that mimic ours,” he cautioned. “I see this as a major strategic threat for us if we don’t fully dominate the photo landscape.”

Facebook Was Crafting Its Own Instagram Competitor

Zuckerberg wasn’t merely concerned—he was poised to take action. Before opting to acquire Instagram, Facebook had interns developing a competing photo-sharing application. However, progress was sluggish, leading Zuckerberg to ultimately determine that Facebook was too far behind.

“In theory, we could construct this technology, but I’m apprehensive that we are quite behind,” he expressed. This realization culminated in the decision to initiate the acquisition, even if it necessitated a higher payment.

Zuckerberg Considered Dismantling Instagram After Purchase

One of the more incriminating pieces of evidence introduced by the FTC is a 2012 message wherein Zuckerberg proposed acquiring Instagram merely to eliminate it as a threat.

“By not terminating their products, we keep everyone from resenting us,” he noted. “However, all further development would focus on our core products.”

Zuckerberg has since defended this communication, emphasizing that Meta did not implement that strategy and instead made substantial investments in Instagram’s expansion.

Facebook Was Apprehensive of Other Platforms, Including Google+

The FTC’s argument also revolves around the concept that Facebook monopolizes the arena for connecting families and friends. To bolster this, the agency underscored Zuckerberg’s earlier concerns regarding now-defunct networks like Path and Google+.

Path, which launched in 2010, centered on intimate social circles. Facebook even contemplated acquiring it. Google+ was another source of unease for Zuckerberg, directly competing in the same social networking sector.

By 2013, Zuckerberg was also troubled by messaging applications like WeChat and Line, even contemplating blocking their advertisements on Facebook to curtail their expansion.

Facebook Attempted to Acquire Snapchat—Twice

It’s widely recognized that Facebook made a $3 billion offer to acquire Snapchat in 2013. What’s new, however, is that the company later increased the offer to $6 billion after its initial rejection. Snap CEO Evan Spiegel turned down both proposals.

Zuckerberg Was Disturbed by Snapchat Stories

After declining Facebook’s buyout offers, Snapchat introduced its Stories feature, which rapidly gained popularity. Internal communications from 2014 reveal Zuckerberg’s concerns.

“Snapchat is currently more of a rival for Instagram and the News Feed than it ever was for messaging,” he stated. “We need to approach this new dynamic with seriousness.”

Instagram subsequently launched its own version of Stories in 2016.

Meta Considers TikTok and LinkedIn as Competitors

Throughout the trial, Zuckerberg confirmed that Meta regards platforms like TikTok and LinkedIn as adversaries. He even presented data indicating that Facebook and Instagram traffic surged by 20% and 17%, respectively, during a temporary TikTok ban in the U.S.

Zuckerberg also pointed out that Meta perceives LinkedIn and even the local social network Nextdoor as competitors, observing that Facebook has evolved beyond just being a platform for friends and family interactions.

This perspective is noteworthy, as the FTC’s argument centers on Meta’s dominance in the “friends and family” social networking segment. By emphasizing broader competition, Meta seeks to undermine the FTC’s case.

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