The US Federal Trade Commission (FTC) has launched an antitrust lawsuit against Meta, which is investigating the legality of its acquisition of social networks Instagram and WhatsApp.
At the court hearing on Monday, Meta CEO Mark Zuckerberg acknowledged that Instagram and Facebook competed as platforms for communication, but emphasised that this was not a priority for Facebook. The FTC argues that Meta has dominated the social networking market for face-to-face communication in the US. Its main competitors are Snapchat and MeWe, the latter of which has 20 million users.
Meta’s attorney Mark Hansen said the company’s influence is somewhat exaggerated. He presented data on Instagram and Facebook traffic growth during the Chinese TikTok outage in the US, as well as YouTube’s surge in popularity during the Facebook outage in 2021. The negative consequences of possibly losing control of Instagram could be significant: Emarketer estimates that Instagram will generate more than $37bn in ad revenue for Meta this year, accounting for more than half of the company’s total ad revenue.
Zuckerberg denied the accusations and said sharing is just one of the app’s priorities along with finding other content. He also said that only 20 per cent of content on Facebook and 10 per cent on Instagram is generated by users’ friends, with the rest being interest-based accounts.
Despite this, the agency is pushing to restructure Meta or sell Instagram and WhatsApp. Losing Instagram could lead to severe revenue declines at the company.
The FTC is pushing for Meta to restructure or sell Instagram and WhatsApp. As Reuters notes, the loss of Instagram could lead to serious revenue declines at the company. Research firm Emarketer predicts Instagram will generate $37bn in ad revenue in the US in 2025, half of Meta’s domestic ad revenue.
