The company may split into three separate entities, with one each controlling the Instagram and WhatsApp accounts. The ruling comes after a lawsuit from shareholders who believe shares in Facebook are worth less because of potential competition to Snapchat.
Facebook, Instagram and WhatsApp are all under investigation for antitrust violations. A judge has ruled that the case can proceed to trial.
Facebook’s market dominance easily surpasses the thresholds required by courts to establish monopolistic power. (Photo courtesy of Reuters)
The Federal Trade Commission’s (FTC) antitrust complaint against Facebook’s parent company, Meta, was denied dismissal by a US court this week.
The result of the litigation might lead to the company’s disintegration.
The court handed the FTC – the American agency for consumer protection – the go light to continue with its lawsuit to compel Mark Zuckerberg’s Meta to sell Instagram and WhatsApp after rejecting the case last year.
According to the FTC, Meta has an illegal monopoly in personal social networking services, which it has maintained by purchasing rivals such as Instagram, a photo-sharing app, and WhatsApp, a personal messaging app.
The judge, James Boasberg, said in a recent decision that the FTC’s original lawsuit had’stumbled out of the blocks,’ but that a revised version had facts that were “much more solid and thorough than previously.”
Judge Boasberg’s view was altered by the new version, and Meta’s move to dismiss the complaint was refused.
Unlike the prior action, the FTC bolstered it with specific charges that Facebook has maintained a market share monopoly.
With Instagram, Facebook, and Whatsapp, Meta has a stranglehold on personal social networking applications. (Photo courtesy of Getty Images) )
The judge’s letter said, ‘Facebook’s market share easily surpasses the thresholds that courts typically deem necessary to establish monopolistic power.’
He did say, though, that proving the charges against the company concerning its purchases of Whatsapp and Instagram, which were approved years ago, might be a ‘huge problem’ for the FTC.
‘Today’s ruling limits the FTC’s case by dismissing accusations regarding Meta’s platform rules,’ a Meta representative told Metro.co.uk.
‘Our investments in Instagram and WhatsApp helped them grow into the companies they are now. They’ve been beneficial to competitors as well as the individuals and companies that choose to utilize our goods,’ they continued.
The corporation had argued that the FTC’s head Lina Khan’s earlier public critiques of Facebook implied a ‘axe to grind’ based on personal hostility or a financial conflict of interest, and that the action should be rejected. However, the judge did not seem to believe this was the case.
‘Although the court understands the significance of her vote, treating Khan as the only originator of the present case is an exaggeration,’ the judge stated.
The FTC’s complaint against Meta is just one of numerous US government measures to keep large internet giants’ monopolies under check.
The US Department of Justice sued Google in October 2021 for allegedly harming competition and customers via anti-competitive conduct.
A class-action complaint was launched earlier this month against both Apple and Google for claimed multi-billion dollar payments from Google to Apple as part of a deal in which the iPhone manufacturer agreed not to compete in the internet search sector.
The FTC’s antitrust action against Mark Zuckerberg’s Meta might result in the internet behemoth’s disintegration. Getty Images has the copyright to this image.
In June, Boasberg rejected the action, claiming that the complaint offered “nothing” to prove Meta’s monopoly other than the fact that it dominated personal social networking services.
During the previous Trump administration, the FTC sued Facebook, but the court dismissed its suit. In August, the agency filed an updated case, seeking a court to order the corporation to sell Instagram and WhatsApp once again.
Meta’s market share of daily active users (DAUs) and monthly active users (MAUs) of social networks, as well as the relative time spent on these networks, were revealed in the latest complaint, which included data from Comscore.
However, the court ruled that the FTC could not pursue claims that Facebook barred rival applications from accessing its platform in order to retain its monopoly since such rules had been abandoned in 2018.
‘Ultimately, it is anyone’s guess whether the FTC will be able to establish its case and succeed at summary judgment and trial,’ Boasberg concluded.
The FTC wants to push Meta to sell Instagram and WhatsApp because of its ‘anti-competitive behaviour,’ according to its new head, Lina Khan.
On a daily basis, 2.8 billion individuals utilize Meta’s platforms throughout the globe.
The lawsuit hasn’t shaken Meta’s confidence, with shares up 1.9 percent on Tuesday, valuing the business at $930 billion pounds (£683 billion).
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The “facebook monopoly 2021” is an article about a lawsuit that Facebook, Instagram and WhatsApp may be split up. The article states that the judge has approved the lawsuit.
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