Meta does not have a monopoly on social media, rules the judge
A US District Judge in Washington has ruled that Meta Platforms, Facebook’s parent company, did not violate antitrust laws through its acquisition of the photo-sharing app Instagram and messaging service WhatsApp more than a decade ago.
The decision represents a defeat for the Federal Trade Commission, the US antitrust watchdog, which sued Meta in 2020 alleging that the company secured a monopoly on social media by buying up its competitors.
“The court ultimately concludes that the agency has not met its burden: Meta does not have a monopoly in the relevant market,” Judge James Boasberg wrote on Tuesday.
The company praised the decision in a statement provided to the BBC, saying that it “realizes that Meta faces fierce competition.”
In April, Judge Boasberg presided over a lengthy trial that featured testimony from Meta CEO Mark Zuckerberg and former chief operating officer Sheryl Sandberg, who argued that TikTok and YouTube had shaken up the social media landscape.
In his decision, Judge Boasberg noted that the FTC reviewed and approved Meta’s 2012 acquisition of Instagram and its 2014 acquisition of WhatsApp.
The agency argued that the company overpaid when it bought Instagram for $1 billion and WhatsApp for $19 billion.
Judge Boasberg described the ever-changing social media landscape, “with apps rising and falling, chasing one craze and moving on from others, and adding new features with each passing year.
Even if Meta had monopoly power in the past, he said the FTC has failed to show “that it still has that power now” as Meta’s market share appears to be “shrinking.”
In a statement to the BBC, the FTC indicated it was unsure whether it planned to appeal.
“We are extremely disappointed in this decision,” said Joe Simonson, director of public affairs at the FTC, adding that the agency is reviewing all of its options.
Simonson also told the BBC that “things were always going against us with Judge Boasberg,” who has clashed several times with the Trump administration and is facing an attempt by Republicans in Congress to impeach him.
The BBC asked Judge Boasberg for comment.
With its victory on Tuesday, Meta averts a potential breakup of the company that could have included the separation of Instagram and WhatsApp.
“Our products are beneficial to individuals and businesses and embody American innovation and economic growth,” a Meta spokesperson told the BBC on Tuesday. “We look forward to continuing to partner with management and invest in America.”
This decision comes after the Justice Department won two previous antitrust cases against Google – one alleging a monopoly in online search and the other in advertising technology.
But earlier this year, another district judge in Washington presiding over the online search case declined to force Google to spin off its Chrome browser, a move the Justice Department suggested was necessary to end the tech giant’s monopoly on search.
Against this backdrop, Tuesday’s ruling against the FTC “seems like a change in momentum,” said Rebecca Howe Allensworth, a professor of antitrust law at Vanderbilt Law School.
“I think this will impact the likelihood of more cases like this being filed.”
But Allensworth added that the ruling does not indicate a failure in the government’s efforts to crack down on antitrust behavior.
“It’s a mixed bag,” she said.
Many legal observers say the FTC’s case against Meta was difficult from the start.
Laura Phillips-Sawyer, a professor at the University of Georgia College of Law, said the case was “always going to be a difficult one, especially given the speed we’ve seen in the social networking market in recent years.”
However, she said the case revealed “a series of statements made by Zuckerberg at the time of those acquisitions that appeared to be a desire to eliminate an emerging threat to Facebook’s dominance.”
Meta’s legal entanglements are far from over.
Zuckerberg has been ordered to testify in a landmark trial about the impact of social media on young people.
Last month, Los Angeles County Superior Court Judge Carolyn Cole rejected Meta’s argument that an in-person appearance in January was not necessary.
Instagram chief Adam Mosseri is also scheduled to testify in the trial, which stems from accusations that Meta and other social media companies make their apps addictive for young people despite being aware of the mental health risks.