Landmark Antitrust Trial Against Meta Begins: Zuckerberg May Face Divestiture

The trial launched in Washington could have major implications for Meta's future, examining whether Zuckerberg's acquisitions eliminated competition.

A high-stakes antitrust trial against Meta Platforms Inc. is set to commence in Washington, D.C., as the Federal Trade Commission (FTC) seeks to challenge the company's dominance in the social media landscape. The case asserts that Meta, which owns Facebook, bought Instagram in 2012 and WhatsApp in 2014 primarily to stifle competition, granting itself significant market control. Although the FTC initially approved these acquisitions, it later committed to track their impact, leading to the current legal showdown.

If the FTC successfully proves its case, Mark Zuckerberg could be compelled to divest both Instagram and WhatsApp, a consequence that would drastically alter the social media landscape. Meta has expressed confidence in its defense, suggesting that users have benefited from Instagram's growth since its acquisition. Experts anticipate that the trial will hinge on Zuckerberg's earlier statements and communications, which may portray the company’s acquisition strategy as a means to eliminate competition rather than enhance user experience.

Vanderbilt Law School’s antitrust professor, Rebecca Haw Allensworth, highlighted that Zuckerberg's assertion that acquiring companies is preferable to competing could serve as striking evidence against him. Meta, however, is likely to focus on demonstrating that its ownership has improved user outcomes, arguing that the essence of the acquisition debate should center on consumer benefits rather than intentions.

As the trial unfolds, both Zuckerberg and former COO Sheryl Sandberg are expected to provide testimonies, with proceedings anticipated to last for several weeks. The FTC v Meta case originated during Donald Trump's first administration but has potential political overtones as Trump regains influence, prompting concerns about possible interference. Reports indicate that Zuckerberg has lobbied Trump to urge the FTC to abandon its case, indicative of the complicated relationship between the tech giant and political elites.

The administration's shakeup of FTC commissioners raises additional alarm, with allegations of intimidation against Democratic commissioners who opposed Trump. Slaughter and Bedoya, two ousted commissioners, have indicated a fear that their replacements may skew the agency's independent authority.

The trial takes place against the backdrop of another pivotal antitrust case, USA v Google, evidencing a broader government initiative to rein in major tech companies. While the FTC faces challenges in proving its case against Meta, experts suggest that the personal network services segment has increased competition, complicating the lawsuit's argument for a forced divestiture of Instagram and WhatsApp.

Meta has defended its position, emphasizing the competitive landscape that includes platforms like TikTok and YouTube. As the trial begins, industry watchers remain attentive to its implications for market dynamics in the tech sector and potential regulatory shifts.