“REALLY SCARY”
Central to the case is Facebook’s 2012 billion-dollar purchase of Instagram – then a small but promising photo-sharing app that now boasts two billion active users.
An email from Zuckerberg cited by the FTC showed him depicting Instagram’s emergence as “really scary,” adding that is “why we might want to consider paying a lot of money for this”.
In his first day of testimony Monday, Zuckerberg downplayed those exchanges as early talk before plans for Instagram came together.
But the FTC argues that Meta’s US$19 billion WhatsApp acquisition in 2014 followed the same pattern, with Zuckerberg fearing the messaging app could either transform into a social network or be purchased by a competitor.
Meta’s defence attorneys counter that substantial investments transformed these acquisitions into the blockbusters they are today.
They also highlight that Meta’s apps are free for users and face fierce competition.
FTC attorney Matheson said in opening remarks that Facebook “decided that competition is too hard and it would be easier to buy out their rivals than to compete with them”.
Meta attorney Mark Hansen countered in his first salvo that “acquisitions to improve and grow an acquired firm” are not unlawful in the United States, saying that is what Facebook did.
A key part of the courtroom battle will be how the FTC defines Meta’s market.
The US government argues that Facebook and Instagram are dominant players in apps that provide a way to connect with family and friends, a category that does not include TikTok and YouTube.
But Meta disagrees.
When asked about Facebook and Instagram main competition, Zuckerberg named Google-owned YouTube and China-based sensation TikTok because video “is the primary way people share content”.
On the video front, Meta has a lot of catching up to do, Zuckerberg told the court.
