Meta Pushes Back Against FTC's Antitrust Lawsuit, Citing Benefits to Consumers from Instagram, WhatsApp Acquisitions

By John Lopez

Apr 05, 2024 06:34 PM EDT

Meta Platforms Inc., formerly known as Facebook, has taken a firm stance against the Federal Trade Commission's (FTC) antitrust lawsuit, which seeks to break up the company. 

Meta argues that consumers have reaped significant benefits from its acquisitions of Instagram and WhatsApp, thus rejecting the FTC's claims.

Meta Challenges FTC Antitrust Case

Meta contends that the FTC lacks evidence to support its assertion that consumers would be better off without the acquisitions of Instagram in 2012 and WhatsApp in 2014. 

The company emphasizes that it has invested substantial resources, amounting to billions of dollars, into developing and enhancing both platforms.

"Attempting to prove its case, the FTC relies solely on speculative claims that having more competitors may be better and that consumers would have benefitted more if Instagram and WhatsApp had been left without Meta's resources. The law rightly requires more than speculation," the company said in a motion for summary judgment.

According to Meta, Instagram's co-founder, Kevin Systrom, testified that the app had minimal revenues before its acquisition and that being part of Meta accelerated its growth and development. 

Similarly, WhatsApp co-founder Brian Acton stated that without Meta's support, the app would not have been able to remain free for users, as it had previously charged a download fee.

Moreover, Meta highlights the economic success of Instagram, which generated a remarkable $32.4 billion in revenue in 2021 alone. The company estimates the standalone value of Instagram to be between $80 billion and $100 billion.

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A photo taken on April 3, 2024 shows the logo of US online social media and social networking service Facebook on a smartphone screen in Frankfurt am Main, western Germany. (Photo by Kirill KUDRYAVTSEV / AFP)
(Photo : Photo by KIRILL KUDRYAVTSEV/AFP via Getty Images)

FTC's Challenge Is a Threat to Innovation: Meta

The core of Meta's argument lies in its criticism of the FTC's market definition, which the company deems too narrow. Meta insists that the personal social networking services market should include competitors like YouTube and TikTok, which the FTC excludes.

In its defense, Meta asserts that the FTC's challenge to past mergers could threaten innovation by creating uncertainty around finalized sales. The company warns against revisiting previously approved transactions, stating that it could hinder competition and ultimately harm consumers.

Meta's motion for summary judgment marks a pivotal moment in the ongoing dispute between the tech giant and antitrust regulators. The FTC has until May 24th to file its opposition, setting the stage for further legal deliberations.

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