Meta’s four-year battle with the Federal Trade Commission (FTC) came to an end on Tuesday (Nov. 18), after Federal Judge James E. Boasberg ruled the Silicon Valley tech giant did not violate antitrust laws when it bought Instagram and WhatsApp.
The company does not hold a monopoly in the social media market, the judge said, handing down a 90-page ruling. He dismissed the FTC’s lawsuit, saying Meta does not have to divest either of the social platforms it acquired.
Meta, then known as Facebook, bought Instagram for $1 billion in April 2012 in a mix of cash and stock. The purchase was just after Instagram’s explosive growth and was considered a high price tag for a startup with 13 employees.
When Meta (then Facebook) bought WhatsApp in 2014 for ~$19 billion, the acquisition was one of the largest in Silicon Valley’s history. The deal included $4 billion in cash, about $12 billion in Facebook stock, and an additional $3 billion in restricted stock units for employees, bringing the total to around $22 billion.
The Changed Social Landscape
Once considered personal social networking, the social media framework has changed significantly since the original FTC lawsuit was filed in 2020. Boasberg said in the ruling that the social media landscape remains highly competitive, pointing to ByteDance-owned TikTok and Google’s YouTube as dominant forces. He said the FTC failed to demonstrate that Meta had a monopoly in social media.
“Believing that the only constant in the world was change, the Greek philosopher Heraclitus posited that no man can ever step into the same river twice. In the online world of social media, the current runs fast, too,” Boasberg said in the ruling.
Mounting Competition
Meta spokesperson Nkechi Nneji said the court’s ruling means it acknowledges the “fierce competition” Meta is facing in social media.
While its platforms have 3.3 billion daily users, Zuckerberg testified that Facebook, which he founded in 2004, has dropped in popularity, particularly among younger demographics.
Nine in 10 teens use YouTube, according to a Pew Research study in October of last year, with YouTube, TikTok, Instagram, and Snapchat being near-constant hangouts for the 13-17-year-olds surveyed.
“My understanding … is that people spend more time on YouTube than on Facebook and Instagram combined, certainly more than either one independently,” Zuckerberg said.
“The amount that people are sharing with friends on Facebook, especially, has been declining,” Zuckerberg said. “Even the amount of new friends that people add … I think has been declining. But I don’t know the exact numbers.”
Messaging, however, “has been growing dramatically,” Zuckerberg said.
Americans now spend only 17% of their time on Facebook viewing content from their friends, according to the court documents. On Instagram, that number is 7%. When TikTok launched in the United States in 2018, it soon put enormous competitive pressure on Meta.
Aside from Facebook, Instagram, and WhatsApp, Meta owns Messenger and Threads. Across its platforms, ad revenue in 2024 topped $160 billion.