Facebook parentMetaPlatforms faces a high-stakes trial in Washington starting on Monday on claims it built an illegal social media monopoly by spending billions of dollars to acquireInstagramandWhatsApp, in a case in which US antitrust enforcers seek to unwind the deals.The acquisitions more than a decade ago aimed to eliminate nascent competitors who could threatenFacebook’s status as the go-to social media platform for users to connect with friends and family, the US Federal Trade Commission claims. It filed the case in 2020 duringDonald Trump’s first term.The FTC seeks to force Meta to restructure or sell parts of its business including Instagram and WhatsApp. The trial poses the first major test for the FTC under the secondTrump administration. The agency began the investigation that led to the trial during Trump’s first term.Legal Defense Fund exits Meta civil rights advisory group over DEI changesRead moreJennifer Newstead, Meta’s chief legal officer, called the case weak and a deterrent to tech investment in a blogpost on Sunday.“It’s absurd that the FTC is trying to break up a great American company at the same time the Administration is trying to save Chinese-owned TikTok,” she wrote.The case poses an existential threat to Meta, which by some estimates earns about half of its US advertising revenue from Instagram, while also giving the public its first real measure of how strongly the newTrump administrationwill follow up on its promises to take on big tech.LosingInstagramwould be a devastating blow to Meta, said Jasmine Enberg, a principal analyst at market research firm Emarketer.“It would also severely damage its future user and revenue growth prospects,” Enberg said. “Instagram is now Meta’s biggest money maker in the US, its most lucrative market, where the app accounts for 50.5% of the company’s ad revenues in 2025. Instagram has also been picking up the slack forFacebookon the user front, particularly among young people, for a long time.”Meta has been making regular overtures to Trump since his election, nixing content moderation policies Republicans said amounted to censorship and donating $1m to Trump’s inauguration. Meta’s CEO,Mark Zuckerberg, has also visited the White House multiple times in recent weeks. Zuckerberg has also purchased a new $23m mansion in DC that would “allow Mark to spend more time there as Meta continues the work on policy issues related to American technology leadership”, a company spokesperson toldPolitico. The billionaire’s companydonated $1mto Trump’s inaugural committee and has unsuccessfully attempted to persuade the president to settle the case against Meta duringmeetings at the White House.“The Trump-Vance FTC could not be more ready for this trial,” said an FTC spokesperson, Joe Simonson, adding: “We are blessed with some of the most hardworking and intelligent lawyers in the country who are working around the clock.”Zuckerberg is expected to testify at the trial, where he will face questioning about emails in which he proposed acquiring the photo-sharing app Instagram as a way to neutralize a potential Facebook competitor and expressed worry that the encrypted messaging serviceWhatsAppcould grow into a social network.Meta has argued in court papers that its purchases of Instagram in 2012 and WhatsApp in 2014 have benefited users, and that Zuckerberg’s past statements are no longer relevant amid fierce competition from ByteDance’s TikTok, Google’s YouTube and Apple’s messaging app.How users spend time on social media, and whether they consider the services interchangeable, will be core to the case. Meta will point to an increase in traffic to Instagram and Facebook duringTikTok’s brief shutdownin the United States in January as evidence of competition, according to court records.The FTC claims Meta holds a monopoly on platforms used to share with friends and family, where its main competitors in the United States are Snap’s Snapchat and MeWe, a tiny privacy-focused social media app launched in 2016. Platforms where users broadcast content to strangers based on shared interests, such as X, TikTok, YouTube and Reddit, are not interchangeable, the FTC has argued.The trial could have far-reaching consequences for the social media industry, according to Forrester’s vice-president of research, Mike Proulx.skip past newsletter promotionSign up toTechScapeFree weekly newsletterA weekly dive in to how technology is shaping our livesEnter your email addressSign upPrivacy Notice:Newsletters may contain info about charities, online ads, and content funded by outside parties. For more information see ourPrivacy Policy. We use Google reCaptcha to protect our website and the GooglePrivacy PolicyandTerms of Serviceapply.after newsletter promotion“The ramifications of this trial coupled with TikTok’s future in limbo potentially puts the very core of the social media market at play,” said Proulx. “No longer would Meta be its centre of gravity. We haven’t seen anything like this since around 2006-2011 – social media’s earliest days. We’d likely see a renaissance of social media startups looking to grab a piece of new social media world order.”The US district judge James Boasberg said in a ruling in November that while the FTC has enough evidence to move forward, the agency “faces hard questions about whether its claims can hold up in the crucible of trial”.The formerFTC chair Lina Khan saidthat Meta resorted to a “buy-or-bury scheme” when it was acquiring players such as Instagram and WhatsApp – if the company could not beat a competitor, it would either acquire the firm or cut off access to Facebook’s network and features. The case was about “free and fair trade”, Khan said in an NBC interview.“There’s no expiration date when it comes to the illegality of the transaction,” Khan said. “I think there is a way in which the entire social networking ecosystem looks different today because Facebook was permitted to go out and make these acquisitions.”Gerry Adams considers suing Meta over alleged use of his books to train AIRead moreThe trial is scheduled to stretch into July. If the FTC wins, it would have to prove at a second trial that measures such as forcing Meta to sell Instagram or WhatsApp would restore competition.Losing Instagram in particular could prove catastrophic to Meta’s bottom line.While Meta does not release app-specific revenue figures, Emarketer forecast in December that Instagram would generate $37.13bn this year, a little over half of Meta’s US ad revenue.WhatsApp to date has contributed only a sliver to Meta’s total revenue, but it is the company’s biggest app in terms of daily users and ramping up efforts to earn money off tools including chatbots. Zuckerberg has said such “business messaging” services are likely to drive the company’s next wave of growth.
Meta faces antitrust claims at trial over Instagram and WhatsApp ownership
TruthLens AI Suggested Headline:
"Meta Platforms Faces Antitrust Trial Over Instagram and WhatsApp Acquisitions"
The Guardian
7.4
TruthLens AI Summary
Meta Platforms, the parent company of Facebook, is facing a significant antitrust trial in Washington, D.C., initiated by the U.S. Federal Trade Commission (FTC). The trial, which started on Monday, centers around allegations that Meta created an illegal monopoly in social media through its acquisitions of Instagram and WhatsApp over a decade ago. The FTC contends that these acquisitions were aimed at eliminating potential competitors that could undermine Facebook’s dominance in social networking. The agency is pushing for Meta to divest parts of its business, including Instagram and WhatsApp, claiming that these actions are necessary to restore competition in the market. This case represents a critical test for the FTC under the new administration, as it seeks to demonstrate its commitment to regulating large tech companies. Meta's chief legal officer has criticized the case, arguing that it undermines investment in technology and calling the FTC's actions absurd, particularly in light of the government's attempts to address competition with foreign entities like TikTok.
The implications of this trial extend beyond Meta itself, touching on the future landscape of social media as a whole. Analysts suggest that losing Instagram could be catastrophic for Meta, as it is projected to generate over half of the company's U.S. advertising revenue. The trial will also examine how social media users engage with various platforms and whether they view services like Instagram and Facebook as interchangeable with others such as TikTok and YouTube. The FTC argues that Meta's acquisitions were part of a 'buy-or-bury' strategy to eliminate competition, while Meta defends its actions by highlighting the benefits these acquisitions have brought to users. As the trial unfolds, it may reshape the social media industry significantly, potentially paving the way for new startups to emerge and challenge the existing order. With the trial expected to continue until July, the stakes for Meta and the broader tech landscape are exceptionally high.
TruthLens AI Analysis
The recent article highlights significant legal challenges facing Meta Platforms, the parent company of Facebook, Instagram, and WhatsApp. It underscores a trial that could reshape the social media landscape in the U.S. and possibly lead to the undoing of past acquisitions deemed monopolistic. This situation is positioned within the broader context of antitrust scrutiny on major tech companies, reflecting ongoing tensions between regulatory bodies and the tech industry.
Purpose of the Article
The article aims to inform the public about the legal proceedings against Meta, emphasizing the implications of these antitrust claims. By detailing the potential outcomes, such as the forced sale of Instagram and WhatsApp, it raises awareness of the stakes involved for Meta and for consumers who rely on these platforms.
Public Perception
This news might foster a sense of skepticism towards large tech companies and support for regulatory actions designed to promote competition. The narrative surrounding Meta's acquisitions suggests a need for scrutiny over corporate power and its effect on consumer choice.
Information Omission
While the article presents the FTC's position clearly, it may gloss over the complexities of the tech marketplace and the potential benefits of large mergers, such as innovation and improved services. By focusing on the antitrust claims, it might lead the audience to overlook arguments in favor of Meta’s business practices.
Manipulative Elements
The article could be viewed as slightly manipulative due to its framing of the FTC's actions as a necessary challenge against corporate dominance, potentially eliciting emotional responses from readers who are concerned about monopolistic practices. The language used emphasizes the existential threat to Meta, which could provoke sympathy for the company among its users and investors.
Reliability of the News
The report appears to be based on credible sources, including official statements from the FTC and Meta's legal representatives. However, the potential bias in portraying the FTC's actions as purely protective of competition, without acknowledging the nuances of tech ownership, may affect its reliability.
Market and Economic Impact
The trial's outcome could have significant consequences for Meta's stock, as losing its key revenue sources like Instagram would likely diminish investor confidence. The ripple effects could extend to other tech stocks, especially those in the social media sector, as market participants assess the implications of increased regulatory scrutiny.
Societal and Political Ramifications
This case may influence public opinion toward greater regulation of tech giants, potentially leading to broader legislative changes. The trial serves as a litmus test for the Biden administration's commitment to antitrust enforcement, which may resonate with voters concerned about corporate influence in politics.
Community Support Dynamics
The article is likely to resonate with consumer advocacy groups and individuals who prioritize digital rights and fairness in the marketplace. It may also attract support from those skeptical of corporate monopolies and interested in fostering a more competitive environment.
Global Power Dynamics
While this issue primarily concerns the U.S. market, it reflects a global trend where governments are increasingly scrutinizing large tech companies. This trial could set a precedent that influences other nations facing similar challenges with monopolistic practices in tech. In conclusion, the article serves to highlight a pivotal moment in the ongoing discourse around antitrust laws and the tech industry. It portrays the legal actions against Meta as a critical step toward ensuring competition in social media, while also hinting at the broader implications for corporate regulation.