Meta is set to begin an antitrust trial against the US Federal Trade Commission (FTC) on April 14, in Washington. The trial will address allegations that Meta monopolizes the personal social networking market.

The FTC argues that Meta’s acquisitions of Instagram in 2012 for US$1 billion and WhatsApp in 2014 for US$19 billion were anti-competitive.

The agency claims these deals helped Meta maintain dominance by eliminating competition.

Meta denies the allegations, saying it competes with TikTok, YouTube, and Apple’s iMessage.

Meta CEO Mark Zuckerberg, former COO Sheryl Sandberg, and other key figures will testify. Executives from rival firms like TikTok and Snap are also expected to speak.

The trial will explore how the FTC defines the social networking market and whether Meta’s actions harmed competition.

🔗 Source: CNBC

🧠 Food for thought

1️⃣ Historical tech antitrust cases offer cautionary lessons for Meta

The Microsoft antitrust case of the late 1990s provides important context for understanding Meta’s current legal battle.

When Microsoft faced similar allegations about monopolistic practices, its stock traded sideways for approximately 15 years after settlement, significantly impacting shareholder returns 1.

The Microsoft case shifted antitrust focus from simple price concerns to broader consumer harm through impeded competition and innovation, which aligns with the FTC’s allegations against Meta regarding its acquisitions of Instagram and WhatsApp 2.

Despite predictions of Microsoft’s demise, the company survived its antitrust battle and eventually thrived in new areas like cloud computing. This suggests that even if Meta faces forced divestiture, it could adapt and recover over time 2.

The Microsoft case may have created space for companies like Google to emerge by restraining Microsoft’s aggressive market practices. This raises questions about what new competitors might flourish if Meta’s acquisitions were unwound 2.

2️⃣ Market definition is the critical battleground in tech antitrust

The Meta case hinges fundamentally on how the court defines the relevant market, with the FTC’s narrower “personal social networking” definition favoring its monopoly claims.

Recent Meta developments