Meta Disputes FTC Claims That Instagram, WhatsApp Acquisitions Harmed Consumers

Meta Platforms asked a judge Friday (April 5) to throw out an antitrust lawsuit filed against it by the Federal Trade Commission.

In a court filing, the tech company disputed the FTC’s claims that its purchases of Instagram and WhatsApp reduced competition and harmed consumers, Bloomberg reported Friday.

Meta said the two platforms have become as successful as they are because it supported their development with billions of dollars, according to the report.

The FTC filed its suit in 2020, alleging that Meta illegally dominated the personal social networking market by acquiring emerging rivals that could have become competitive threats — Instagram in 2012 and WhatsApp in 2014 — the report said.

The agency wants the court to undo those two deals, per the report.

A judge initially dismissed the case, saying the FTC had not proven that Meta had a monopoly in social networking, but then allowed it to move forward when the agency revised its complaint in 2021, according to the report. A trial has not yet been scheduled.

Meta argued that the FTC’s definition of the market is too narrow, as 184 public companies have said in securities filings that they compete with Meta, Facebook or Instagram, per the report.

Instagram’s founders said in depositions that before the acquisition by Meta, Instagram had no revenues and no strategy to monetize its service, according to the report. They added that with Meta’s purchase, Instagram was able to accelerate its development and gain access to more users.

A WhatsApp co-founder testified that Meta’s support enabled it to offer its service for free, where it previously charged $1 to download the app, according to the report.

In other developments around antitrust issues, it was reported in January that both the FTC and the Department of Justice were in discussions about a possible antitrust investigation regarding OpenAI’s relationship with Microsoft.

In December, it was reported that the FTC was continuing its legal battle to challenge Microsoft’s acquisition of Activision Blizzard. The agency argued that the deal raises competitive concerns and could lead to Microsoft dominating the gaming industry.