The battle on the line Federal Trade Commission – the finish line has been going on since 2019. It was then that FTC and a group of 40 prosecutors began a formal investigation against the company managed by Marek Zuckerberg. The allegations concern, among others monopolistic practices of the concern in the social media sector. The meta is currently the owner of three large platforms – Facebook, Instagram and Whatsapp. The number of active users for the first of the website is over 3 billion, and in the case of the other two – over 2 billion.
In 2020, the FTC case against Meta went to the Federal Court in Washington. Over the next few years, legal scuffles lasted. The group's lawyers tried to dismiss it and achieved half -success. In 2021, the judge James Boasberg He dismissed the first FTC claim, considering that monopolistic allegations are too high and poorly documented.
However, FTC did not give up. Under the leadership Khan ropes, which is famous for its hard approach to Big Techów, the Commission filed a new lawsuit, this time with stronger evidence. In 2022, the judge allowed the lawsuit to continue, considering that FTC provided sufficient grounds to continue the case.
The substantive phase of the process is currently underway, which includes Hearing of witnesses, including Marek Zuckerberg himself. Facebook creator on Tuesday For almost 9 hours he explained his accusations of the monopolistic practices of his company. But this is just the beginning of interrogations.
What are the main allegations of FTC against Meta?
1) anti -competitive acquisitions – FTC claims that the purpose of taking over Instagram in 2012 and Whatsappa in 2014. There was an elimination of competition, not a natural expansion. The internal meta documents, disclosed during the proceedings, suggest that the company's management (including Mark Zuckerberg) considering the acquisitions as a way to “neutralize the threat”.
During the opening occurrence of the process against the finish line FTC Daniel Matheson He said the finish “built a moat”, To protect your interests, By taking over two startups and used her position to generate giant profits. He cited, among others Zuckerberg's words from an internal email, in which the latter said that “it is better to buy than compete.” According to FTC, these words well illustrate the strategy of the concern.
2) suppressing competition by closing the ecosystem – FTC also argues that Facebook as “Social Internet Gates” She allowed him to influence the development of other companies. Examples of such finishing activities include. blocking access to API (application programming interface, i.e. a set of rules and protocols that enable communication between applications) or Copying competitors' solutions – e.g. Instagram Stories as a response to Snapchat and Instagram's success Reelswhich works almost the same as Tiktok.
3) a threat to innovation – FTC believes that the monopolistic position of Meta has weakened the rate of innovation in social media – new, creative platforms have no chance to develop in the face of the dominant position and aggressive meta.
How does the finish defend?
1) FTC agreed to take over – Meta argues that both the acquisition of Instagram and Whatsapp was previously approved by the Federal Trade Commission. Understanding them after years is therefore inconsistent.
If we didn't buy Instagram and Whatsappa, today's social world would look completely different
– explained Mark Zuckerberg during Tuesday's hearing before the court. At the same time, he emphasized that, contrary to what FTC Meta claims, she built these platforms again, and not just “took over ready products”.
2) Facebook has competition – The company also claims that Social media market It is very competitive today. It also points to specific examples – YouTube, Tiktok, Discord or Reddit.
It is not that a user who cannot send a message via Facebook cannot send it at all. He just does it through IMessage, Snapchat or Tiktoka. ”
– explained Zuckerberg.
3) potential damage to users – The company claims that breaking the finish would hurt users, destroying comfortable connections between platforms (e.g. logging in, integrated messages).
4) a dangerous precedent – According to META lawyers, FTC activities may discourage innovation, suggesting that even previously approved transactions can be questioned later.
What can happen?
1) Metal breakdown – FTC wants the court to order separation of Instagram and WhatsApp from Facebook – It would be one of the most serious antitrust precedents from the time of the breakdown of AT & T (1982) and matters against Microsoft (1998).
2) Ban on subsequent acquisitions – Even if the finish is not broken, FTC may force constant supervision and a ban on taking over new companies without prior consent.
3) new regulations for the industry – The meta case can lead to legislative changes – work is underway in the USA on the reform of antitrust law, taking into account the specificity of Big Techów.
Are other big-techs also threatened?
Yes. The finish line is not the only company that is currently on FTC. The Commission and the Department of Justice (Doj) conduct parallel actions against Google, Amazon and Apple. This is part of a larger trend in which the state wants regain control over the concentration of power in the hands of several technological behamots. The administration of Joe Biden for years supported an aggressive approach to antitrust actions – nominating to FTC a person with a clearly critical attitude towards Big Techów, like the already mentioned Khan lina.
As the chairwoman of FTC, Khan was known for her aggressive approach to the enforcement of antitrust regulations. Under her leadership, FTC undertook actions against large technology companies and sought to block several large mergers, including Kroger's takeover of Albertsons and attempts to take over ARM by NVIDIA
Who is the new head of FTC?
The problem is that Lian Khan FTC is no longer at the forefront. She was dismissed from this function by the new President Donald Trump in January this year. In this position he replaced her Andrew N. Ferguson:
- Ferguson is a conservative lawyer, earlier, among others court advisor of republican senators and prosecutor general in Virginia.
- He is known for its probesity approach, skepticism in the face of excessive regulation and the belief that the government should act sparingly and with great respect for the free market.
- His nomination clearly indicates that Trump wants to “slim down” the aggressive FTC actions carried out for Biden and Khan ropes.
What does this mean for the matter against the finish?
FTC vs. The finish goes on now Before an independent federal court, so Donald Trump cannot interrupt her like that. But:
- The new head of FTC may initiate the withdrawal of some of the allegations against the finish or propose a settlement instead of a further trial.
- It may conclude that breaking the company (Instagram, WhatsApp etc.) would be too radical and unnecessary.
- In practice, this would mean saving the finish line from the most serious consequences.
Why did Zuckerberg love Donald Trump?
After the victory of Donald Trump in the presidential election in the USA Zuckerberg, who for years built the image of a neutral technocrat, suddenly took great sympathy for an American businessman. Already in January, during a visit to the podcast, Joe Rogana managed to attack the administration of the outgoing president Joe Biden for “brutal attacks on his company”, he announced “loosening moderation” on Facebook, and appealed to “more male energy” in technology companies.
The American government should defend its companies and not be a blade of the spear targeted at them
– explained in an interview with Rogan “Zuck”, Referring to the problems of his enterprise during Biden's rule. At the same time Zuckerberg He said he was a “optimist” about the return of Donald Trump to the White House. “I think he wants America to win” – he said.
Later the finish line made a generous donation to the inaugural fund of Trump's presidency, And Zuckerberg himself was one of the honorary guests of this event. There is no doubt that The billionaire is counting on help today Donald Trump in a court battle, which can lead to the breakdown of his company.
Will Trump save “Zucka?
With Trump in the White House and Ferguson in FTC, the period of “regulatory thaw” begins. Under the rule of the new president of Big Techy they will probably be able to to act more freely, take over smaller companies and limit competition. This does not mean, however, that Trump will quickly close the topic of breaking the finish monopoly. Especially that the politician still has a lot of regret for Zuckerberg for events from the near past – For example, to block his Facebook account after the Trump's supporters' attack on Capitol in January 2021. Trump has also repeatedly accused technology companies – especially Facebook, Google and Twitter – of censorship of conservative voices. He even spoke about the need for “digital monopolies”.
For now, Andrew Ferguson ensures that the administration of Donald Trump does not intend to interfere in the battle between FTC and the META company. In a recent interview with Fox News He stated that FTC “certainly” thinks that the finish is a “monopoly”.
FTC strives to make a monopoly similar to that of the finish created, never repeat itself again
he added. And this gives some hope that the matter will not go to the bin “. In the same interview Andrew Ferguson, however, pointed out that “mergers and acquisitions are an important part of how the economy is developing” and affect its “innovation and life”.
When asked by The Verge For a possible command from President Donald Trump regarding the withdrawal of the claim against Meta, Ferguson replied:?
The president is the head of the executive power and I think it is important to follow the lawful commands.
He added, however, that he did not expect such a situation. “I think the president realizes that we must enforce the law, so I would be very surprised if something like this happened,” he explained.