Fb father or mother Meta Platforms faces a high-stakes trial in Washington beginning on Monday on claims it constructed an unlawful social media monopoly by spending billions of {dollars} to accumulate Instagram and WhatsApp, in a case the place US antitrust enforcers search to unwind the offers.
The acquisitions greater than a decade in the past aimed to get rid of nascent rivals who may threaten Fb’s standing because the go-to social media platform for customers to attach with family and friends, the US Federal Commerce Fee claims. It filed the case in 2020 throughout Donald Trump’s first time period.
The FTC seeks to drive Meta to restructure or promote elements of its enterprise together with Instagram and WhatsApp. The trial poses the primary main take a look at for the FTC underneath the second Trump administration. The company started the investigation that led to the trial throughout Trump’s first time period.
Jennifer Newstead, Meta’s chief authorized officer, referred to as the case weak and a deterrent to tech funding in a weblog publish on Sunday.
“It’s absurd that the FTC is making an attempt to interrupt up an incredible American firm on the similar time the Administration is making an attempt to avoid wasting Chinese language-owned TikTok,” she wrote.
The case poses an existential risk to Meta, which by some estimates earns about half of its US promoting income from Instagram, whereas additionally giving the general public its first actual measure of how strongly the brand new Trump administration will comply with up on its guarantees to tackle huge tech.
Shedding Instagram could be a devastating blow to Meta, stated Jasmine Enberg, a principal analyst at market analysis agency Emarketer.
“It might additionally severely harm its future consumer and income progress prospects,” Enberg stated. “Instagram is now Meta’s largest cash maker within the US, its most profitable market, the place the app accounts for 50.5% of the corporate’s advert revenues in 2025. Instagram has additionally been selecting up the slack for Fb on the consumer entrance, significantly amongst younger folks, for a very long time.”
Meta has been making common overtures to Trump since his election, nixing content material moderation insurance policies Republicans stated amounted to censorship and donating $1 million to Trump’s inauguration. Meta’s CEO, Mark Zuckerberg, has additionally visited the White Home a number of instances in current weeks. Zuckerberg has additionally bought a brand new $23m mansion in DC that will “permit Mark to spend extra time there as Meta continues the work on coverage points associated to American expertise management”, an organization spokesperson informed Politico. The billionaire’s firm donated $1m to Trump’s inaugural committee and has unsuccessfully tried to influence the president to settle the case in opposition to Meta throughout conferences on the White Home.
“The Trump-Vance FTC couldn’t be extra prepared for this trial,” stated FTC spokesperson Joe Simonson, including: “We’re blessed with a number of the most hardworking and clever legal professionals within the nation who’re working across the clock.“
Zuckerberg is predicted to testify on the trial, the place he’ll face questioning about emails through which he proposed buying photo-sharing app Instagram as a option to neutralize a possible Fb competitor and expressed fear that encrypted messaging service WhatsApp may develop right into a social community.
Meta has argued in court docket papers that its purchases of Instagram in 2012 and WhatsApp in 2014 have benefited customers, and that Zuckerberg’s previous statements are now not related amid fierce competitors from ByteDance’s TikTok, Google’s YouTube and Apple’s messaging app.
How customers spend time on social media, and whether or not they take into account the companies interchangeable, will probably be core to the case. Meta will level to a rise in site visitors to Instagram and Fb throughout TikTok’s temporary shutdown in the US in January as proof of competitors, in line with court docket information.
The FTC claims Meta holds a monopoly on platforms used to share with family and friends, the place its fundamental rivals in the US are Snap’s Snapchat and MeWe, a tiny privacy-focused social media app launched in 2016. Platforms the place customers broadcast content material to strangers based mostly on shared pursuits, comparable to X, TikTok, YouTube and Reddit, will not be interchangeable, the FTC has argued.
The trial may have far-reaching penalties for the social media trade, in line with Forrester’s vice-president of analysis, Mike Proulx.
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“The ramifications of this trial coupled with TikTok’s future in limbo doubtlessly places the very core of the social media market at play,” stated Proulx. “Not would Meta be its centre of gravity. We haven’t seen something like this since round 2006-2011 – social media’s earliest days. We’d seemingly see a renaissance of social media startups seeking to seize a chunk of recent social media world order.”
US district choose James Boasberg stated in a ruling in November that whereas the FTC has sufficient proof to maneuver ahead, the company “faces onerous questions on whether or not its claims can maintain up within the crucible of trial”.
Former FTC chair Lina Khan stated that Meta resorted to a “buy-or-bury scheme” when it was buying gamers comparable to Instagram and WhatsApp – if the corporate couldn’t beat a competitor, it might both purchase the agency or minimize off entry to Fb’s community and options. The case is about “free and honest commerce”, Khan stated in an NBC interview.
“There’s no expiration date on the subject of the illegality of the transaction,” Khan stated. “I feel there’s a manner through which the whole social networking ecosystem appears totally different as we speak as a result of Fb was permitted to exit and make these acquisitions.”
The trial is scheduled to stretch into July. If the FTC wins, it must show at a second trial that measures comparable to forcing Meta to promote Instagram or WhatsApp would restore competitors.
Shedding Instagram specifically may show catastrophic to Meta’s backside line.
Whereas Meta doesn’t launch app-specific income figures, Emarketer forecasted in December that Instagram would generate $37.13bn this yr, a little bit over half of Meta’s US advert income.
WhatsApp so far has contributed solely a sliver to Meta’s complete income, however it’s the firm’s largest app by way of day by day customers and ramping up efforts to earn cash off instruments together with chatbots. Zuckerberg has stated such “enterprise messaging” companies are more likely to drive the corporate’s subsequent wave of progress.
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