TLDR
- A US district judge ruled against the FTC in its antitrust lawsuit against Meta, allowing the company to keep Instagram and WhatsApp
- Judge James Boasberg found the FTC failed to prove Meta purchased Instagram and WhatsApp to eliminate competition
- The court rejected the FTC’s claim that Meta holds a monopoly in personal social networking, citing competition from YouTube and TikTok
- Meta would have been forced to divest Instagram and WhatsApp if it lost the case
- The lawsuit was originally filed by the Trump administration in 2020 and continued under Biden
Meta Platforms won a major legal victory on Tuesday. A federal judge threw out the Federal Trade Commission’s antitrust case against the social media company.
Judge James Boasberg ruled that the FTC failed to prove its case. The agency claimed Meta bought Instagram and WhatsApp specifically to eliminate them as competitors.
The FTC wanted Meta to sell both platforms. This came despite the commission approving both acquisitions years ago. Instagram was purchased in 2012 and WhatsApp in 2014.
The judge found problems with the FTC’s arguments. Government lawyers tried to define a “personal social networking market” that included only Facebook, Instagram, and Snapchat.
Boasberg sided with Meta’s position instead. The company argued this narrow market definition no longer exists.
Meta faces competition from multiple platforms. YouTube and TikTok both compete for users’ attention and time.
Changing Market Dynamics
“With apps surging and receding, chasing one craze and moving on from others, and adding new features with each passing year, the FTC has understandably struggled to fix the boundaries of Meta’s product market,” Boasberg wrote in his ruling.
The judge emphasized a key point about monopoly claims. The FTC needed to show Meta holds monopoly power now, not just in the past.
“Whether or not Meta enjoyed monopoly power in the past, though, the agency must show that it continues to hold such power now,” he wrote. “The Court’s verdict today determines that the FTC has not done so.”
The stakes were high for Meta. Losing Instagram would have stripped away one of its biggest revenue generators.
Instagram has become crucial to Meta’s strategy. The platform helps the company compete directly with TikTok.
WhatsApp represents another valuable asset. It’s one of the world’s most popular messaging apps.
Political Context
The case had a complicated political history. The Trump administration filed the initial lawsuit in 2020.
The Biden administration continued pursuing the case. This created an unusual situation where both administrations supported the action.
Mark Zuckerberg’s relationship with Trump has evolved over time. The Meta CEO suspended Trump’s account after the January 6 Capitol attack.
Trump threatened to jail Zuckerberg in response. But their relationship has warmed recently.
Zuckerberg has met with Trump several times since his return to office. Meta donated to Trump’s inauguration fund and to construction of the White House’s new East Wing.
The antitrust trial began seven months ago. Several Meta executives testified during proceedings, including Zuckerberg himself.
Alphabet recently won its own antitrust case. The government accused the Google parent company of monopolizing online search.
Wall Street analysts maintain a Strong Buy rating on Meta stock. The consensus price target of $846.48 represents 42.87% upside from current levels. This rating comes from 34 Buy, seven Hold, and one Sell recommendation among 42 analysts.
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