Meta Platforms has defeated the long-running monopoly case of the Federal Trade Commission over its acquisitions of Instagram in 2012 and WhatsApp in 2014. U.S. District Judge James Boasberg sided with the tech giant and ruled Tuesday that the FTC failed to prove Meta holds monopoly power in the so-called personal social networking market.
Boasberg emphasized that social networking, as defined in the early days of Facebook, no longer exists. He cited Greek philosopher Heraclitus to explain further that users cannot step into the same river twice, noting that the FTC missed the opportunity to block the acquisitions. Today, Meta competes with broader rivals, including TikTok and YouTube.
Adding TikTok alone to the market analysis, Boasberg wrote, invalidates the monopoly claims of the FTC. Evidence showed users are shifting massive amounts of time to competing apps, forcing Meta to invest in maintaining engagement. The judge concluded that Meta cannot be considered a monopolist insulated from competition in any meaningful sense.
The FTC faced credibility issues with its expert witness, Scott Hemphill. Boasberg noted the public alignment of Hemphill with figures advocating for the breakup of Facebook compromised his neutrality. With little direct evidence of monopoly harms, the judge said his testimony could not reliably support the arguments of the FTC, thus further weakening the case.
Boasberg highlighted that Facebook and Instagram users now spend most of their time on short-form videos. This aligns Meta with entertainment platforms like TikTok and YouTube. The judge also cited trends, including better smartphones, improved mobile data, AI-driven content recommendations, and user boredom with the posts of their friends.
The judge outlined six factors that undermined the narrow market definition of FTC: smartphone adoption, better mobile data, advanced AI recommendations, user boredom, disruption by TikTok, and changing social norms discouraging public posting. These changes made Meta apps functionally similar to competitors, thus invalidating the claims of the FTC.
Boasberg also dismissed the arguments that Meta degraded app quality through higher ad loads or underinvestment in features related to friends or mutual connections. Data showed users still engage with advertisements. The decline in posting stemmed from social trends. Users also prefer Reels over the posts of their social friends or mutual connections.
The Federal Trade Commission filed a lawsuit against Meta in 2020. It alleged that acquisitions of Instagram in 2012 and WhatsApp in 2014 created a monopoly in social networking. The agency argued that the dominance of Meta, then known as Facebook, stifled competition, harming rivals and limiting consumer choice in digital communication platforms.