Meta heads to court over alleged illegal monopoly that could force it to sell Instagram, Whatsapp

Thomson Reuters

· Posted: Apr 14, 2025 11:35 AM EDT | Last Updated: 4 minutes ago

Facebook genitor Meta Platforms faces a high-stakes proceedings successful Washington starting connected Monday connected claims it built an amerciable societal media monopoly by spending billions of dollars to get Instagram and WhatsApp, successful a lawsuit wherever U.S. antitrust enforcers question to unwind the deals.

The acquisitions much than a decennary agone aimed to eliminate competitors who could endanger Facebook's presumption arsenic the go-to societal media level for users to link with friends and family, the U.S. Federal Trade Commission claims. It filed the lawsuit successful 2020, during U.S. President Donald Trump's archetypal term.

The FTC is trying to unit Meta to restructure oregon merchantability parts of its business. That means if the committee is successful, Instagram and WhatsApp could beryllium hived disconnected from Meta to go their ain entities erstwhile again.

In a blog station on Sunday, Meta main ineligible serviceman Jennifer Newstead called the case weak and a deterrent to tech investment.

"It's absurd that the FTC is trying to interruption up a great American institution astatine the aforesaid clip the Administration is trying to prevention Chinese-owned TikTok," she wrote.

The lawsuit poses an existential menace to Meta, which by some estimates earns astir fractional of its U.S. advertizing gross from Instagram, portion besides giving the nationalist its archetypal existent measure of however powerfully the caller Trump medication volition travel up on its promises to instrumentality connected Big Tech.

Meta has been making regular overtures to Trump since his election, nixing contented moderation policies Republicans said amounted to censorship and donating $1 cardinal USD to Trump's inauguration. Meta CEO Mark Zuckerberg has besides visited the White House aggregate times successful caller weeks.

WATCH | How overmuch wealth has Big Tech fixed to Donald Trump?

"The Trump-Vance FTC could not beryllium much acceptable for this trial," said FTC spokesperson Joe Simonson, adding, "We are blessed with immoderate of the astir hardworking and intelligent lawyers successful the state who are moving astir the clock."

WhatsApp and Instagram helped Facebook determination its concern from desktop computers to mobile devices, and to stay fashionable with younger generations arsenic rivals similar Snapchat (which it besides tried, but failed, to buy) and TikTok emerged.

However, the FTC has a constrictive explanation of Meta's competitory market, excluding companies similar TikTok, YouTube and Apple's messaging work from being considered rivals to Instagram and WhatsApp.

"The FTC already has the hard task, whether it's looking astatine 10 years agone oregon 5 years agone oregon today, of trying to specify what is the marketplace we're talking astir successful a sufficiently constrictive mode that it tin amusement Meta has a ton of powerfulness successful that market," said Paul Swanson, an antitrust lawyer for the instrumentality steadfast Holland & Hart.

"And I bash deliberation that situation has gotten harder arsenic the years person gone by and we spot much and much imaginable competitors successful societal media spaces."

Zuckerberg expected to testify

Zuckerberg is expected to attest astatine the trial, wherever he will look questioning astir emails successful which helium proposed acquiring photo-sharing app Instagram arsenic a mode to neutralize a potential Facebook competitor, and expressed interest that encrypted messaging work WhatsApp could turn into a societal network.

Meta has argued successful tribunal papers that its purchases of Instagram successful 2012 and WhatsApp successful 2014 person benefitted users, and that Zuckerberg's past statements are nary longer applicable amid fierce contention from ByteDance's TikTok, Google's YouTube and Apple's messaging app.

How users walk clip connected societal media, and whether they consider the services interchangeable, volition beryllium halfway to the case. Meta volition constituent to an summation successful postulation to Instagram and Facebook during TikTok's little shutdown successful the United States in January arsenic grounds of competition, according to tribunal records.

The FTC claims Meta holds a monopoly connected platforms utilized to share with friends and family, wherever its main competitors successful the United States are Snap's Snapchat and MeWe, a tiny, privacy-focused societal media app launched successful 2016.

Platforms where users broadcast contented to strangers based connected shared interests, specified arsenic X, TikTok, YouTube and Reddit, are not interchangeable, the FTC has argued.

U.S. District Judge James Boasberg said successful a ruling in November that portion the FTC has capable grounds to determination forward, the bureau "faces hard questions astir whether its claims can hold up successful the crucible of trial."

The proceedings is scheduled to agelong into July. If the FTC wins, it would person to beryllium astatine a 2nd proceedings that measures such arsenic forcing Meta to merchantability Instagram oregon WhatsApp would restore competition.

Instagram particularly invaluable to Meta

Losing Instagram successful peculiar could beryllium catastrophic to Meta's bottommost line.

While Meta does not merchandise app-specific gross figures, advertising probe steadfast Emarketer forecast successful December that Instagram would make $37.13 cardinal this year, a small over half of Meta's U.S. advertisement revenue.

Instagram besides generates much gross per idiosyncratic than any other societal platform, including Facebook, according to Emarketer.

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WhatsApp to day has contributed lone a sliver to Meta's total revenue, but it is the company's biggest app successful presumption of daily users, and is ramping up efforts to gain wealth disconnected tools like chatbots. Zuckerberg has said specified "business messaging" services are apt to thrust the company's adjacent question of growth.

The lawsuit is 1 of 5 wherever the FTC and U.S. Department of Justice impeach Big Tech companies of maintaining illegal monopolies.

Amazon and Apple are some being sued, and Alphabet's Google is facing 2 lawsuits, including one wherever a proceedings is acceptable to statesman adjacent week connected the government's bid to unit Google to merchantability its Chrome browser.