Meta is focusing on TikTok in its monopolistic dispute
As the antitrust trial unfolds, posing significant implications for the future of Meta Platforms’ social-media dominance, the company may find its most viable path to a favorable court outcome through an unexpected source: TikTok. The Federal Trade Commission is pursuing the dissolution of Meta, contending that it maintains an unlawful monopoly established over ten years ago via Facebook’s purchases of Instagram and WhatsApp. For the agency to succeed, it must demonstrate that Meta has participated in illegal monopolization and that its market dominance remains intact. TikTok plays a pivotal role in this context.
The FTC has systematically laid out evidence to bolster its assertion that Meta has effectively eliminated much of the competition in the market for consumers utilizing social media to engage with friends and family. Meta has attempted to refute that assertion by contending that the social-media landscape has transformed into a medium for entertainment and information dissemination. In the current landscape, Meta asserts that TikTok’s short-form video platform represents a significant competitor. That position has garnered some support.
During an inquiry on Wednesday, a senior executive from TikTok stated, in response to a Meta lawyer’s questioning, that his company differs significantly from Instagram and Facebook. “We are an app and we have social features, but I don’t think of us as a social app,” stated Adam Presser, TikTok’s head of operations. Meta’s legal representatives subsequently underscored a collection of internal analyses from TikTok that complicated the situation. “YouTube and Instagram are TikTok’s most important competitors,” one management document from 2021 stated. Other records were also cited. “The short-video interfaces on TikTok, Instagram and YouTube are now virtually indistinguishable,” TikTok communicated to an Australian government agency in March.
TikTok has introduced social features, including a friends tab, which enhances its resemblance to a social-networking product, as observed by Meta lawyer Aaron Panner. Meta Chief Executive Mark Zuckerberg, during his testimony last month, stated that Instagram and Facebook have evolved to resemble TikTok, transitioning from social networking to “more of a broad discovery-entertainment space.” Kevin Systrom, co-founder of Instagram, primarily provided testimony that bolstered the FTC’s case. However, he similarly noted the evolution of social media.“The current horizon of the products is all about entertaining users with video content,” Systrom stated in court. “Facebook, TikTok, and Instagram are all significant players in the social media landscape.” Additionally, I would like to mention YouTube.
An internal TikTok document identified Instagram as a rival. The FTC asserts that Facebook prioritizes personal connections as the core of its user experience. Internal documents from Meta, presented in court by the FTC, including survey data, indicate that users primarily appreciate Facebook and Instagram for maintaining connections with friends and family. TikTok, conversely, depends on an algorithm that dictates the selection of videos presented to users. The algorithm is indifferent to the user’s familiarity with the individual who created the video, as noted by Presser and other observers. The objective is to maintain user engagement with the application.
U.S. District Judge James Boasberg, presiding over the case without a jury, has maintained a degree of discretion regarding his opinions thus far. However, certain inquiries he has made indicate a lack of familiarity with social media platforms. He has occasionally raised doubts about the distinctions among various social-media platforms, observing that they share numerous similar features. “Why isn’t the current usage merely a matter of degree?” Boasberg inquired of a witness from the FTC.
The commission is anticipated to persist in articulating its case for a minimum of one additional week. The majority of its time has been devoted to establishing that Facebook acquired Instagram and WhatsApp specifically to neutralize them as potential competitors. The lawyers representing the FTC have submitted numerous internal emails and presentations from Meta, revealing that Zuckerberg and other executives expressed significant concern regarding the potential impact of Instagram and mobile messaging applications like WhatsApp on Facebook’s business, particularly in relation to its performance on mobile devices.
Prior to its acquisition of WhatsApp in 2014, Meta anticipated that mobile messaging applications, especially those gaining traction in Asia, would encroach upon its social networking domain.
“Could you please compile a presentation that reflects the concerning trends based on the data we currently possess?” Javier Olivan, currently serving as Meta’s chief operating officer, articulated in an email.
Following Zuckerberg’s acquisition of Instagram in 2012, he faced challenges regarding the extent of promotion for the photo-sharing platform, concerned that its expansion might undermine Facebook’s growth, as indicated by Systrom’s testimony. In 2018, when Instagram reached the milestone of one billion users, Systrom indicated that Meta had declined its request for additional resources to bolster initiatives related to video, spam prevention, and data security.
Systrom asserted that his app had the potential to evolve into a significant rival to Facebook had it continued to operate independently. However, when interrogated by a lawyer representing Meta, he conceded that the backing from Meta significantly contributed to its swift expansion during the period from 2012 to 2018.
“We experienced significantly accelerated growth as a result of our association with Facebook compared to what we would have achieved as an independent entity,” Systrom stated.
