Monday marks the start of the trial for social media giant Meta, which is accused by the US government of abusing its market dominance to buy Instagram and WhatsApp before they could compete.
As it proceeds, the trial in a federal court in Washington crushes Meta CEO Mark Zuckerberg’s hopes that the government will relax its enforcement of antitrust laws against Big Tech after Donald Trump returned to the White House.
The owner of Facebook may be compelled to sell Instagram and WhatsApp, which have become major worldwide players since their acquisition, as part of the Meta case, which is being brought by the Federal Trade Commission (FTC), the formidable US consumer protection organization.
Judge James Boasberg, who is also overseeing a well-known case concerning White House directives to deport Venezuelans under wartime legislation, will preside over the trial and render a decision.
When the lawsuit was first brought against Meta in December 2020, during the first Trump administration, everyone was waiting to see if he would ask the FTC to step aside.
The third-richest man in the world, Mark Zuckerberg, has visited the White House several times in an attempt to convince the US president to settle rather than fight the trial—a move that would be unprecedented at this point.
The Verge reported that FTC Chair Andrew Ferguson downplayed the likelihood, saying, “I would be extremely astonished if something like that ever happened.”
Zuckerberg changed content moderation guidelines and made a donation to Trump’s inaugural fund as part of his lobbying efforts. In an apparent attempt to spend more time at the political power center, he recently paid $23 million for a residence in Washington.
Jonathan Kanter, an antitrust enforcer in the Biden administration, told CNBC that it would be “borderline embarrassing if Zuckerberg went to the White House and wound up with a settlement.”
The US government recently launched five significant tech antitrust actions, including the Meta complaint.
Apple and Amazon are also going to court, while Google is facing two trials after being found guilty of abusing its search-market dominance in August.
Over the course of a trial that is anticipated to last at least eight weeks, Zuckerberg, his erstwhile lieutenant Sheryl Sandberg, and a lengthy line of executives from competing companies will be taking the stand.
Facebook’s 2012 billion-dollar acquisition of Instagram, a tiny but promising photo-sharing service with two billion active users today, is at the heart of the case.
Zuckerberg described Instagram’s rise as “very worrisome” in an email that the FTC quoted, adding that it is “why we might want to explore paying a lot of money for this.”
The FTC contends that Zuckerberg’s concern that the messaging service might either become a social network or be acquired by a rival influenced Meta’s $19 billion acquisition of WhatsApp in 2014.
Defense lawyers for Meta will contend that the company’s large spending made these acquisitions into the current bestsellers.
They will also emphasize how fiercely competitive Meta’s apps are and how free they are for users.
The FTC contends that a drastically diminished user experience—with an excessive number of advertisements and product modifications that consumers are forced to put up with—is evidence of Meta’s monopoly strength.
Identifying the market
How the FTC determines Meta’s market will be a major judicial battlefield.
According to the US government, Facebook and Instagram are the leading companies in the app market for family and friend connections, which excludes TikTok and YouTube.
Meta, however, is not in agreement. “Every 17-year-old in the globe is aware that Instagram, Facebook, and WhatsApp compete with TikTok, YouTube, X, iMessage, and many more Chinese-owned platforms,” a representative stated.
On Substack, attorney Brendan Benedict stated, “The larger Meta can make the relevant market… the more likely it is to overcome the FTC’s lawsuit.”
Leaders News Blog 