Meta had its first day in court against the Federal Trade Commission in what will be the second-largest antitrust trial of the decade. At stake is Meta’s ownership of both Instagram and WhatsApp, and the viability of Mark Zuckerberg’s company as traditional social media enters the era of AI. Say what you will about the political influence of Meta and the repositioning of Zuckerberg since Trump’s return to the White House, but the federal government’s case against Meta is yet another abuse of antitrust enforcement power in Washington, and it deserves to fail.
Though the acquisitions were completed over a decade ago when social media was in its infancy, the FTC has muscled its monopoly claim forward with relative consistency between the Biden and second Trump administrations.
What’s most glaring in this case is its overt political nature. Big Tech, or the FAANG companies (Facebook, Amazon, Apple, Netflix, and Google), have seen their fortunes in D.C. sour ever since the populist wave that first ushered in Trump in 2016. Since then, every political tide change has been ascribed to social media’s “bigness” and influence. Hillary Clinton’s 2016 defeat, COVID censorship, and the Hunter Biden laptop debacle in 2020 have created a bipartisan appetite for Meta to pay a price.
To quote Trump’s FTC chair Andrew Ferguson, “bringing the heat to Big Tech” is a top priority, and this antitrust case is the delivery mechanism for Washington’s retribution. In Trump’s ear are advisors suggesting Meta “rigged and stole” the 2020 election, revealing how the state of market competition plays second fiddle to politics.
The FTC’s playbook hinges on the argument that Meta, then known as Facebook, sought to acquire both companies in order to “illegally eliminate” competition, which would strike anyone familiar with the current age of social media as laughable. Facebook is something of a punchline for Gen Z and younger Millennials, and Instagram seems to follow the lead of YouTube and TikTok when it comes to short-form viral content.
At the time, Meta’s $1 billion purchase of Instagram was mocked by comedian Jon Stewart on “The Daily Show,” shouting, “A billion dollars of money … for a thing that kind of ruins your pictures?!”
Facebook’s purchase was a lateral attempt to catch up on the sharing of filtered pictures in a feed-like app, something we can now judge in hindsight was a brilliant business move. For WhatsApp, on the other hand, it was about providing the messaging and calling VOIP service that could connect large groups, another lateral move by the social media giant. That purchase in 2014 cost them nearly $20 billion.
Biden’s FTC chair, Lina Khan, simultaneously the most radical and unsuccessful antitrust enforcer in American history, described these acquisitions on CNBC as if they were illegal by default. This is not how antitrust law works.
Facebook took a huge risk and won, but only for a time. What kind of message does it send to innovators and investors that the federal government will fleece you for any strategic growth? Khan admitted on “60 Minutes” that she viewed financial pain from defending acquisitions as a win in and of itself.
How are consumers being benefited by the DOJ’s effort to force Google and Chrome to split apart, or Instagram and WhatsApp being potentially severed from Meta?
Consumers are an afterthought in these cases.
The FTC’s lawyers will have to blissfully ignore how much Facebook, Instagram, and WhatsApp are all used to cross-post and share content from across the entire social media spectrum. Half of what’s in your Reels feed is also posted on apps that Meta considers to be their competition, and there is a lot of competition right now for people’s time.
And let’s not forget, time is the commodity being fought for here by tech firms. Consumers pay nothing for any of these services, and in many cases, they make money on them. This makes the evidence on consumer harm even more elusive, even if it weren’t such a competitive landscape.
While it’s not the duty of Washington to clear all obstacles for any company that serves the national interest, the FTC’s relentless attacks on U.S. digital services companies do Americans no good in an increasingly hostile world.
The European Union is prepared to unleash a whirlwind of regulatory penalties on U.S. tech companies that run afoul of its draconian laws, and China holds nothing back when it comes to aggressively positioning its AI and social companies for success.
Global powers are “knives out” for the American tech sector and for U.S. dominance in general, yet Washington seems oddly inclined to assist rivals in pursuing cases against Amazon, Google, and Apple on similarly dubious grounds.
There is a middle ground between government favoritism and punitiveness, and it looks a lot like simply scaling back the antitrust revolution within the FTC. Focus on real harms to consumers, not fruitless ideological pursuits.
Yaël Ossowski is deputy director at the Consumer Choice Center.
This article was published in RealClear Politics (archive #1, #2) and syndicated on Yahoo (archive #1, #2).