Meta defeated a major challenge to its business on Tuesday when a US judge ruled that the company does not hold a monopoly in social networking.
The case, brought by the US Federal Trade Commission, could have forced the tech giant to spin off Instagram and WhatsApp, with the former FTC chair accusing the company of operating a “buy or bury” scheme against nascent competitors. The tech giant bought WhatsApp for $19bn in 2014. Losing either the image-based social network, which generates an estimated half of Meta’s revenue, or the world’s most popular messaging app could have done existential damage to Meta’s empire.
The US district judge James Boasberg issued his ruling on Tuesday after the historic antitrust trial wrapped up in late May.
“The landscape that existed only five years ago when the Federal Trade Commission brought this antitrust suit has changed markedly,” Boasberg wrote, citing the rise of TikTok in particular as evidence of competition in the social networking market. Boasberg also chided the FTC, which brought the case against the tech giant, for failing to account for the YouTube video platform as meaningful competition. “Even if YouTube is out, including TikTok alone defeats the FTC’s case,” he wrote.
Jennifer Newstead, Meta’s chief legal officer, wrote at the start of the trial: “It’s absurd that the FTC is trying to break up a great American company at the same time the administration is trying to save Chinese-owned TikTok.”
The judge’s decision follows two separate rulings that branded Google an illegal monopoly in both search and online advertising, dealing a regulatory blow to the tech giant that for years enjoyed nearly unbridled growth.
In contrast to the victory over Google, the ruling in Meta’s favor dampens the regulatory crackdown initiated by the US government to rein in tech giants, some of the largest and most powerful corporations in the world. The FTC has also sued Amazon for anticompetitive practices. The US justice department has filed suit against Apple, accusing it of operating a “broad, sustained and illegal smartphone monopoly”.
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The FTC “continues to insist that Meta competes with the same old rivals it has for the last decade, that the company holds a monopoly among that small set, and that it maintained that monopoly through anticompetitive acquisitions”, Boasberg wrote in his ruling. “Whether or not Meta enjoyed monopoly power in the past, though, the agency must show that it continues to hold such power now. The court’s verdict today determines that the FTC has not done so.”