Mark Zuckerberg scores a precious goal against the Federal Trade Commission (FTC), the United States markets supervisory authority. Meta, the parent company of the social network Facebook, has won a battle in a trial accusing it of a monopoly in the social media market due to links between its video and photo-sharing subsidiary Instagram and the messaging service WhatsApp.
A district judge in Washington, DC, issued a ruling declaring that the evidence presented by the Federal Trade Commission, the public body that prosecutes market abuse, is insufficient to charge Meta with violating US antitrust law.
The case that began five years ago, during the first Trump administration, in the midst of a pandemic, sought to demonstrate Meta’s dominant position because the agreements between its two social platforms, Instagram and Whatsapp, allowed it to control the social media market.
U.S. District Court Judge in Washington, D.C., James Boasberg, points out in the order issued Tuesday: “Whether or not Meta has enjoyed monopoly power in the past, the agency must demonstrate that it continues to have it now.” And it rules: “Today’s Court ruling establishes that the FTC did not do so.”
The judge was sympathetic to the federal agency, but understands that the evidence presented is insufficient. “With applications coming and going rapidly, chasing one fad and leaving others behind, and adding new features every year, it’s understandable that the FTC has had difficulty defining the market for Meta’s products,” he concludes.
After learning of the ruling, Meta stock managed to recover part of the losses recorded during the session, which remained just over half a point. The tech giant’s shares have risen nearly 2% this year, lagging the tech sector, raising questions about its strategy.
The latest trial against Meta lasted seven weeks in which the founder of Meta, Mark Zuckerberg, and the former chief operating officer, Sheryl Sandberg, who left the company in 2022 after being Facebook’s number two for 12 years, appeared in court.
Judge Boasberg justifies his verdict with the profound transformation that the social media business has experienced in recent years and with Meta’s loss of importance. The trend has shifted towards video applications, with the rise of TikTok and YouTube, dominators of this segment with huge user bases and a large impact on the network, according to CNBC. “The most used part of Meta’s applications is therefore indistinguishable from the offerings of TikTok and YouTube,” Boasberg notes in his opinion.
Although the first FTC lawsuit occurred in 2020, the case came to Boasberg’s court in 2021. The judge then dismissed the lawsuit because he believed the US market watchdog had not presented sufficient evidence. The FTC was quick to build its case, presenting a lengthy document with additional evidence, including details on the number of users and the company’s metrics compared to competitors. In 2022, Boasberg admitted the case to trial after reviewing new evidence.
During the trial, the FTC alleged that Meta purchased Instagram and WhatsApp in 2012 and 2014 with the aim of strengthening its monopoly in the social media market. Meta argued that its competitors’ business is broader because it includes video, e-commerce and private messaging. The company called executives from Reddit, X, TikTok and Pinterest to testify about how their apps try to capture users’ time and attention and, ultimately, advertising dollars.
The Meta case is one of five major antitrust lawsuits brought by the FTC against the world’s largest technology platforms. Two federal judges have already ruled that Google has abused its dominant position in the online advertising market, while lawsuits against Amazon and Apple remain pending, he recalls Bloomberg.
