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have Dismissing an antitrust lawsuit against a company before it goes to trial. It joins 48 states and territories in trying to force the company to sell Instagram and WhatsApp, which it acquired in 2012 and 2014, respectively.
The agency and dozens of attorneys general allege that Meta (then known as Facebook) acquired the two platforms to stifle competition. Meta CEO Mark Zuckerberg said, “Facebook’s acquisition and control of Instagram will not only quell the direct threat posed by Instagram, but will also allow other companies to take advantage of mobile photo sharing. “We recognized that this would significantly hinder our ability to gain popularity as a provider of personal social networking,” the FTC argued. “Like Instagram, WhatsApp posed a powerful threat to Facebook’s personal social networking monopoly, but Facebook targeted it for acquisition rather than competition.”
Mehta points out that not only did the FTC approve both acquisitions in the first place, but the first complaint was dismissed for not making a plausible case. Although the judge allowed the filing of the amended complaint, Meta said that “through the discovery process, investigative agencies must It did nothing to build a case.” harmed consumers or competition through their purchases;
In its motion for summary judgment, the company noted that Instagram accounted for nearly 30 percent of its total revenue. Instagram wasn’t making any money when it acquired the service for $1 billion in 2012. Instagram currently had just 2 percent of its more than 1 billion users, Mehta said, adding that he introduced features such as direct messaging, live streaming, Stories and Instagram. shopping. As for WhatsApp, Meta made the service free to use, added end-to-end encryption, and implemented voice and video calling.
Meta claims to have invested billions of dollars and millions of hours of effort into the app. Both Instagram and WhatsApp are in a better position as a result, they argue, to the benefit of consumers and businesses.
Elsewhere, Mr. Mehta argues that the FTC has failed to establish a relevant antitrust market, arguing that the FTC’s definition of the “personal social networking services” market includes “only four companies: Facebook, Instagram, Snapchat, and MeWe. It uses an artificially limited set of data and ignores many companies.” He is one of the most popular activities people are doing on Facebook and Instagram. For example, Meta points out that YouTube and TikTok offer similar services as Reels.
Additionally, the company says the FTC’s claim that Meta has a “dominant share” of the artificial “market for personal social networking services” does not hold true. Mehta says that’s because the FTC’s “market share numbers are meaningless without a properly defined market.”
Meta accused the FTC of exercising “structurally unconstitutional powers” over the company, and used the opportunity to further criticize the agency and its antitrust rules. “The decision to review a completed transaction is tantamount to declaring that any sale is not final,” said Jennifer Newsted, Meta’s chief legal officer. . Newstead said the Instagram and WhatsApp lawsuits “not only raise questions and uncertainty about the U.S. government’s merger review process and whether acquiring companies can actually rely on the results of regulatory review processes, but also It will make us rethink our investments in innovation.” Because if their innovations lead to success, they can be punished. ”