The last time that the Federal Trade Commission of the United States (FTC) was able to break a large corporation was more than four decades ago, with the separation of AT&T.
The successful antitrust case against Meta, the parent company of Facebook, Instagram and WhatsApp, has begun in Washington, DC, United States.
The founder and CEO Mark Zuckerberg takes the pod for the second consecutive day today. The batteries of emblematic cases target of taking charge of Instagram and WhatsApp before they could become competitors.
Demand is the culmination of an investigation of almost six years on whether the social networks giant broke competition laws in the United States in the acquisition of Instagram and WhatsApp. At stake is the future of the advertising business of $ 1.4 billion finish and the possibility of having to turn their very popular services in separate companies.
Zuckerberg takes political strategy
The Federal Court trial in Washington has expelled Zuckerberg’s hopes that the return of the president of the United States, Donald Trump to the whites, see that the government leaves the application of the antimonopoly law against the great technology. Zuckerberg, the third richest person in the world, has made repeated visits to the White House while trying to persuade the president to choose an agreement instead of fighting the trial.
As part of his lobbying efforts, Zuckerberg contributed to the Trump opening fund and reviewed content moderation policies. Hi, he also bought a $ 23 million mansion in Washington in what was seen as an attempt to spend more time near the center of political power.
But the United States Federal Commission of Commerce (FTC) has not shown interest in leaving its impulse against goal. The FTC president appointed by Trump, Andrew Ferguson, said in an interview about Fox Business that the agency would not let a similar target monopoly emerge. Ferguson’s impulse is not far from the previous president of the FTC, Lina Khan, who under the former president of the United States, Joe Biden, was known for being hard with the great technology.
The case could see the Facebook owner forced to uninverting Instagram and WhatsApp, which have become global powers since their purchases.
The demand was originally filed in December 2020, the duration of the Trump’s first administration, and all the eyes were in itself the Republican President, upon his return to the White House, would ask the FTC to retire.
More than a decade of acquisitions
Central of the case is the purchase of $ 1 billion of Instagram Facebook, then a small but promising application to share photos that now has two billion active users.
A Zuckerberg email cited by the FTC showed him that he represented Instagram’s emergence as “really scary” and added that this was “why we could consider considering paying a lot of money for this.”
On his first day of testimony on Monday, Zuckerberg minimized those exchanges as early conversations before Instagram plans joined.
But the FTC argues that the acquisition of WhatsApp of $ 19 billion goal in 2014 followed the same pattern, with Zuckerberg fearing that the application of messages could be transformed into a social network or bought by a competitor.
Meta defense lawyers responded that substantial investments transformed these acquisitions into the box office successes that are today.
They also emphasize that goal applications are free for users and face a fierce competition.
The FTC lawyer, Daniel Matheson, said in the opening comments on Monday that “they decided that the competition is too difficult and that it would be easier to buy from their rivals than to compete with them.”
Goal pushes back
The Meta Mark Hansen lawyer responded in his first save that “acquisitions to improve and grow an acquired company” are not illegal in the United States, saying that is what Facebook did.
A key part of the court battle will be how the FTC defines the finish line.
The United States government argues that Facebook and Instagram are dominant players in applications that provide a way to connect with family and friends, a category that does not include Tiktok and YouTube.
But goal does not agree.
“The evidence in the trial will show what every 17 -year -old in the world knows: Instagram, Facebook and WhatsApp compete with Tiktok, YouTube, X, Imassage and many others, owned by China, to the Reuters news agency.
If the FTC is finally successful in its efforts to break target, it would be the first time in 40 years that the agency would have forced a corporate break. In the early 1980s, the FTC forced the telecommunications company AT&T to divide separately.