Meta Wins Monopoly Case: Judge Rules Social Networking Era Over
▼ Summary
– A US district judge ruled that the FTC failed to prove Meta holds a monopoly in the narrowly defined “personal social networking” market.
– The judge determined that the market definition is outdated and Meta now competes with a broader range of apps, including TikTok and YouTube.
– Evidence showed consumers are shifting significant time to rival platforms, forcing Meta to invest heavily to remain competitive.
– Including TikTok alone in the market analysis was sufficient to defeat the FTC’s monopoly claims against Meta.
– The judge questioned the neutrality of an FTC expert witness, noting their alignment with public calls to break up Facebook.
A federal judge has dismissed monopoly claims against Meta, determining that the Federal Trade Commission failed to prove the company holds a dominant position in today’s evolving digital environment. The ruling highlights a pivotal shift in how courts now view social media competition, acknowledging that platforms like TikTok and YouTube present substantial challenges to Meta’s family of apps. This decision marks a significant legal victory for Meta, which has faced prolonged scrutiny over its acquisitions of Instagram and WhatsApp.
In his Tuesday opinion, U.S. District Judge James Boasberg concluded that the FTC did not successfully demonstrate Meta possesses a monopoly within what regulators termed the “personal social networking” sector. The agency had contended that only Snapchat and MeWe operate as meaningful competitors in this narrowly defined space, but the judge found this argument unconvincing. Boasberg emphasized that the practice of siloing apps into distinct social networking categories no longer reflects digital reality.
Referencing the ancient Greek philosopher Heraclitus, who observed that one cannot step into the same river twice, the judge suggested the FTC had missed its window to contest Meta’s past acquisitions. He aligned with Meta’s position that the early era of social media, epitomized by Facebook’s original model, has fundamentally transformed. Today, the competitive field includes a diverse array of platforms that capture user attention and advertising revenue.
Evidence presented in the case showed users devoting considerable time to rival services, compelling Meta to invest heavily simply to remain competitive. Boasberg noted that the inclusion of TikTok alone in market analysis was enough to undermine the FTC’s monopoly argument. He wrote that when consumers redirect their engagement en masse to competing apps, it becomes evident that Meta does not operate free from competitive pressures.
The FTC’s case faced additional complications when the court questioned the impartiality of one of its key expert witnesses. Judge Boasberg determined that Professor Scott Hemphill could not have approached his testimony with an open mind, given his public alignment with advocates calling for Facebook’s breakup. This perceived lack of neutrality made it difficult to evaluate his opinions objectively, especially in a case where direct evidence of monopoly harm was already limited. The agency has expressed disappointment with the outcome but has not yet announced its next steps.
(Source: Ars Technica)
