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> "The FTC's lawsuit against Meta defies reality. The evidence at trial will show what every 17-year-old in the world knows: Instagram, Facebook and WhatsApp co
by henryfjordan 2y ago
> "The FTC's lawsuit against Meta defies reality. The evidence at trial will show what every 17-year-old in the world knows: Instagram, Facebook and WhatsApp compete with Chinese-owned TikTok, YouTube, X, iMessage and many others," Meta spokesperson Chris Sgro said in a statement.
Everyone knew at the time that Facebook bought Instagram because it threatened Facebook's dominance, and hindsight shows that exactly that happened. There's a huge swath of people that dropped off FB and now use Insta, but Meta owns both. It was a great move but it was absolutely anti-competitive at the time.
- ilrwbwrkhv 2y agoNow the real thing that has to be seen is whether Mark Zuckerberg is "masculine" enough to escape from "the matrix".
- ceejayoz 2y agoThey're also directly behind some of the anti-TikTok push; again, trying to kneecap their competition. https://www.cbsnews.com/sanfrancisco/news/report-facebook-hired-pr-firm-to-smear-tiktok/ https://www.cbsnews.com/sanfrancisco/news/report-facebook-hi...
- wikipedia 2y agoOver the last ~3 years I've been passively following the negative PR campaign against TT by Meta; a lot of the outrage felt a bit manufactured, specifically the outlandish claims like the 'slap a teacher challenge' which, upon investigation, didn't actually exist [0] [0] https://www.vice.com/en/article/slap-a-teacher-tiktok-challenge-hoax/ https://www.vice.com/en/article/slap-a-teacher-tiktok-challe... https://archive.ph/ERLFo https://archive.ph/ERLFo - Facebook paid Targeted Victory, a PR firm, to malign TikTok https://archive.ph/wYuvL https://archive.ph/wYuvL - A whistleblower’s power: Key takeaways from the Facebook Papers https://archive.ph/rWDA4 https://archive.ph/rWDA4 - Mark Zuckerberg says TikTok is a threat to democracy, but didn't say he spent 6 months trying to buy its predecessor https://archive.ph/H8SIk https://archive.ph/H8SIk - Before Mark Zuckerberg Tried To Kill TikTok, He Wanted To Own It https://archive.ph/liFKi https://archive.ph/liFKi - FACEBOOK’S PLAYBOOK TO BEAT COMPETITORS HAS HAD TO CHANGE WITH TIKTOK https://archive.ph/9XSqi https://archive.ph/9XSqi - Facebook Tries to Take Down TikTok https://archive.ph/LWTHf https://archive.ph/LWTHf - Reuters: Factbox: Facebook and TikTok's fraught history - quick look https://archive.ph/H3dfJ https://archive.ph/H3dfJ - Facebook Parent Company Defends Its PR Campaign to Portray TikTok as Threat to American Children
- mupuff1234 2y agoPlus they tried to buy other companies that they thought posed a threat (snap, etc?)
- unreal37 2y agoThe government is claiming that Facebook bought Meta and Whatsapp because it couldn't compete with them. Is that illegal? I don't understand! Every company that buys another company buys it because it adds something to their business. It's a ridiculous claim.
- Retric 2y agoIt’s an argument for how to break up the company not just a complaint about what happened. Companies that buy a supplier or customer frequently didn’t compete with that supplier so breaking them off wouldn’t break up the monopoly. Whatsapp was purchased as a competition and therefore there’s a solid case for spitting the company along that line. Split off Instagram and things look even more competitive.
- pengaru 2y ago> The government is claiming that Facebook bought Meta and Whatsapp because it couldn't compete with them. s/Meta/Instagram/
- miltonlost 2y agoYes, trying to beat your competition by buying them is incredibly illegal and should be illegal. If you have 70% of a market and an up-and-comer is now at 25% but growing, a market leader purchasing their competitor to maintain their market position is an anti-competitive move and why we don't and shouldn't allow every single horizontal or vertical or conglomerate merger. >it because it adds something to their business. It's a ridiculous claim. "It" and "Something" are incredibly vague and meaningless. Their vacuousness is what allows you to not understand the illegal behavior.
- jasode 2y ago>, trying to beat your competition by buying them is incredibly illegal If you weren't aware, it's actually legal to buy a competitor. It just has to pass antitrust review. E.g. In 2006, the government approved Google acquisition of Youtube which competed with Google Video: https://www.google.com/search?q=google+2006+acquisition+youtube+antitrust+approval https://www.google.com/search?q=google+2006+acquisition+yout... Companies buy/merge competitors all the time that passes FTC legal review. E.g. Boeing acquired competitor McDonnell Douglas. Hewlett-Packard acquired Compaq Computer. And sometimes US government encourages mergers. E.g. US asks stronger bank buy a weaker competitor bank. It's been leaked that the US Govt is encouraging competitors Intel and AMD to merge ... so the USA semiconductor industry can be stronger and thus, less dependent on Taiwan TSMC and stay ahead of China. https://www.google.com/search?q=us+government+encouraging+intel+amd+merger https://www.google.com/search?q=us+government+encouraging+in...
- fallingknife 2y agoIt was a tiny 1 billion dollar acquisition of a company with less than 50 employees. If everyone knew at the time how dominant Instagram would become, that "everyone" sure didn't include the founders and investors in Instagram.
- henryfjordan 2y agoFacebook, wary of someone doing to them what they did to MySpace, was going around buying anyone who might be the next thing. It wasn't necessarily clear that Insta would blow up in the way it did but it was clear that was Facebook's motivation for buying. Also "tiny 1 billion dollar acquisition" is not how I'd characterize what was the largest acquisition FB had made up to that point: https://archive.nytimes.com/dealbook.nytimes.com/2012/04/09/facebook-buys-instagram-for-1-billion/ https://archive.nytimes.com/dealbook.nytimes.com/2012/04/09/... > Though Facebook is known for smaller acquisitions, Instagram’s surging momentum likely compelled the social network to swiftly put together a billion-dollar offer.
- thegreatpeter 2y agoMira just raised $2B for her company pre-revenue and pre-product.
- wongarsu 2y agoTech valuations were lower across the board in 2012. Meta 15x'd its market cap since then, and Google 10x'd its valuation, despite both companies still holding essentially the same market position today as they did back then. If anything both have a weaker position today than in 2012.
- henryfjordan 2y agoMeta's position is much better, they own Insta and Whatsapp now! Diversification! Google rise makes less sense but their position as king of search seems even more concrete than ever before (although LLMs might threaten that if they don't stay competitive I guess).
- paxys 2y agoIf everyone indeed "knew at the time" then why did the FTC allow the acquisition to go through in a 5-0 vote?
- surge 2y agoThis is what I don't get, the FTC is suing because the FTC allowed something to happen, when the platforms had even more dominance than they do now? Kind of stinks of less than valid motivations based on the timing of bringing this up over a decade after the fact.
- dylan604 2y agoI guess theZuck didn't donate enough to the campaign
- eastbound 2y agoThe trial has to go through in all cases of bribing: - If I’m the politician, then I need to keep the company on the edge until the end of the trial where I promise them to be acquitted; - If I’m the CEO, I need the trial to go through and acquit me, because it guarantees me against future trials.
- throwanem 2y ago> I need the trial to go through and acquit me, because it guarantees me against future trials On substantially identical charges, where the principle of double jeopardy holds sway.
- singleshot_ 2y agoIn the same jurisdiction*
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- jjallen 2y agoThis implies that every horizontal acquisition is anti-competitive, does it not? If not I would love to read why not.
- michaelt 2y agoIf there are 7 different grocery stores in driving distance of my house and two of them merge, I've still got a choice of 6 stores so there's still reasonable competition. If there are 3 different grocery stores and two of them merge, though? That's a different matter. And if 1 of the remaining 2 is the zero-waste organic store that only rich people and hippies use? It might not even be providing all that much competition.
- ensignavenger 2y agoThere are far, far, far more than just 7 photo sharing apps/websites within the same number of clicks as Facebook and Instagram.
- AnthonyMouse 2y agoThe thing that makes something a competitor is the ability to act as a substitute. That means grocery stores that are 1000 miles away don't count. For photo sharing, what makes something a viable substitute is having a sufficient network effect, so photo sharing services with hundreds of users aren't a substitute for ones with millions. This implies that mergers between large services that have a network effect should always be prohibited, but why is that even a problem unless your goal is to thwart competition? It would also create a useful incentive: Federated systems (like email) have a single network that spans entities. If Microsoft wants to buy Hotmail, they're not buying a separate network so you don't have to be worried about it even if they each have 25 million users as long as that's not too large a percentage of the billion people who use email. So then companies would want to participate in federated systems instead of creating silos like modern social networks do, because then they would be as strictly prohibited from doing mergers.
- snovymgodym 2y ago
- megaman821 2y agoCan you show me something from that time that shows this was the dominate sentiment? Because I remember everyone laughing the Facebook would pay so much for such a simple app.
- henryfjordan 2y agohere's a Techcrunch article from the time: https://techcrunch.com/2012/04/09/facebook-to-acquire-instagram-for-1-billion/ https://techcrunch.com/2012/04/09/facebook-to-acquire-instag... > Last year, documents for a standalone Facebook mobile photo sharing app were attained by TechCrunch. Now it seems Facebook would rather buy Instagram which comes with a built-in community of photographers and photo lovers, while simultaneously squashing a threat to its dominance in photo sharing.
- doctorpangloss 2y agoSherman Antitrust Act fits on a single sheet of paper. Does the statute say anything about the sentiments of the blogs you read?
- chourobin 2y agoThis is a joke, everyone made fun of FB paying 1 BILLION dollars for Instagram, they didn't even have an android app at the time.
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- Aunche 2y ago> Everyone knew at the time that Facebook bought Instagram because it threatened Facebook's dominance, and hindsight shows that exactly that happened. This is something that people can claim to know from hindsight. When Facebook acquired it, Instagram was a photo sharing app that had 13 employees.
- chasing 2y agoThe conversations at that time were definitely about how Instagram had the heat that Facebook was losing. I felt there was no question that they were neutralizing a competitor. (WhatsApp only had, like, 50 employees when FB bought it for $19B, as a bit of evidence that headcount isn’t necessarily a measure of value.)
- dmix 2y agoIf they bought both Instagram and Snapchat it would have been neutralizing competition. Instagram acquisition was just a business staying relevant after a youth market grew up and soured on them while the next younger ones wanted something else cooler designed for 100% around mobile. I believe intention and behaviour matters much more to antitrust than simply continuing to be a dominant market leader by smartly staying on top of what the public wants. Google search doing horizontal integration into Android and Chrome to cut off competition's market entry points at lower levels is far more plausible antitrust narrative IMO.
- Larrikin 2y agoThey tried to buy Snapchat multiple times and the guy refused after seeing how much Facebook valued Instagram and thought he could get more than a billion.
- dmix 2y agoYes it was between the two if I remember correctly. If they bought both it'd be crossing into near total monopoly, at least before Tiktok took off. But they are pretty far from that now IMO. At least in terms of competition from tons of other services. It's possible they did other shady things outside of that.
- nonethewiser 2y agoAnti competitive how though? It helped them, and facebook helped instagram, but where is the monopoly?
- eGQjxkKF6fif 2y ago? Meta owning Instagram and Facebook is the monopoly. Owning things that BILLIONS AND BILLIONS of users use because you want to own them and control them so others don't, that's the monopoly. Innovation can't happen without Facebook's say-so, that's the monopoly, and over way too many people.
- Jensson 2y agoCollusion helps all involved parties but is anti competitive since companies should compete not cooperate.
- beepbopboopp 2y ago[flagged]
- samplatt 2y agoI'm guessing that there's just a younger audience, now. We'd just been off the back of two decades of MS buying everything it got near, it was just what the done thing was. Instagram was taking serious oxygen away from facebook at the time; the buyout wasn't so much an "everyone knows it" but almost an inevitability.
- beepbopboopp 2y agoId partially agree. The historical case that time erased is that early app store, apps were exploding and disappearing just as quickly and the eventual "zero-risk" on network apps was enormous at the time. Everyone agreed with the trajectory, but no one had consensus on the permanence.
- jmyeet 2y agoSo I have an alternative take on this. I don't agree with your basic facts but I have a different conclusion. If a company, which had 13 employees at the time of acquisition and was ~2 years old, can be a legitimate threat to Facebook (which it was), then how strong is your monopoly, really? For context, we've seen this play out multiple times in the last decade: with Snapchat to some degree but now, more importantly, with Tiktok. Many consider Facebook a relic for old people. IG is rapidly meeting the same fate. It seems to be way more popular with millenials than Zoomers (anecdotally). My point is that when the cost of user switching to a new platform is as simple as downloading a new app and creating a new login, then your "monopoly" lacks the traditional moat or barrier to entry that antitrust is specifically designed to fight. Put another way: this just isn't as urgent as people are making it out to be and (IMHO) it's merely a shakedown by the current administration to get Meta to fall in line with censoring topics that the administration doesn't like.
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- zombiwoof 2y agoIronic because every 17 year old “at the time” was ditching Facebook and on instagram
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- jdblair 2y agoWe're spending a lot of effort discussing what we thought in 2012, when the acquisition on the surface seemed insane ($1B!! For a photo app!) What is more significant is what Meta did since then. I do think Meta didn't see simply a photo sharing app, they saw another social graph they could ingest. They did this quite successfully.
- BrtByte 2y agoIt always cracks me up when Meta trots out the "but look, there's competition now!" argument like that somehow erases the intent behind those acquisitions
- KolenCh 2y agoFrom an actual email from Mark Zuckerberg on February 28th 2012: > Integrating their products with ours to improve the service is also a factor. But in reality, we already know these companies’ social mechanics, and we will integrate them over the next 12–24 months anyway. The integration plan involves building their mechanics into our products rather than directly integrating their products, if that makes sense, by a combination of these two things: neutralizing a potential competitor, integrating their products with ours to improve the service. > One way of looking at this is that what we’re really buying is time. Even if some new competitor springs up buying Instagram, Path, Foursquare, et cetera, now will give us a year or more to integrate their dynamics before anyone can get close to their scale again. Within that time, if we incorporate the social mechanics they are using, those new products won’t get much traction because we will already have their mechanics deployed at scale. https://www.acquired.fm/episodes/meta https://www.acquired.fm/episodes/meta