On Tuesday, a federal judge ruled that Meta had not illegally stifled competition when it acquired Instagram and WhatsApp, and that the company does not hold a monopoly in the “personal social networking” market. Therefore it will not have to divest its acquisitions of the two apps.
The suit was brought by the FTC against Meta in December 2020, arguing that social networking constitutes its own market, and that Meta’s purchase of Instagram and WhatsApp exemplifies anticompetitive behavior in violation of Section 2 of the Sherman Act.
The FTC defined Meta's product market as “personal social networking” for communication with friends and family, and not for entertainment purposes like TikTok and YouTube. However Meta defended itself by claiming that it operates within “the broader field of social media” and that TikTok and YouTube function as “substitutes for Facebook and Instagram.”
Judge James Boasberg wrote in his opinion:
- “Facebook, Instagram, TikTok, and YouTube have thus evolved to have nearly identical main features.”
- Meta’s most popular features are “indistinguishable from the offerings on TikTok and YouTube.”
- “When someone first signed up for Facebook, his friends on the app were his friends in real life. More than a decade later, his offline friends have changed, but his old Facebook friends are still there. Longtime users’ friend lists have thus become an often-outdated archive of people they once knew,” and “posts from friends have therefore grown less interesting.” That sounds personal!
- “Americans now spend only 17 per cent of their time on Facebook viewing content from their friends.” (And just seven per cent on Instagram). “What has replaced content from friends? For the most part, short videos posted by strangers and recommended by AI.”
As much as I hate to admit it, I've got to side with Meta on this one — at least in 2025. If this case had been brought to trial in 2015, my opinion and the case outcome may have been different, but it's an entirely different landscape now. Some might argue that it's an entirely different landscape now because of those anti-competitive acquisitions by Meta in 2012 (Instagram) and 2014 (WhatsApp), and if they had never happened, we'd have even more competition in the market today, but there's really no way of knowing.
The only truth today is that Meta very much competes in the same space as the other apps mentioned, and the line between “personal social network” and “entertainment app” continues to blur across all platforms.