Social Media Monopole Breakup: Trade-offs, Consumer Protections, and the FTC vs. Government Laws in the U.S.
Government lawyers will call a parade of witnesses to show Meta has broken U.S. competition laws in amassing its social media empire.
Meta’s privacy protections are no longer in place as a result of its alleged monopoly status. Better social media apps for all of us would be a result of a break-up. Meta says a break up would hurt consumers and make each of its individual apps less integrated.
In a trial expected to last seven to eight weeks the FTC and Meta will deliver opening statements on Monday.
Dozens of witnesses and mounds of evidence will be scrutinized. The chief operating officer of Facebook, Adam Mosseri, will testify in the government’s favor.
The FTC says it would mean more robust competition among social media startups, and therefore better quality services for everyone. Government lawyers claim that Meta’s dominant position in the marketplace has resulted in degraded quality of services. Competition would improve what is available to consumers, according to the FTC.
Silicon Valley CEO Mark Zuckerberg is in agreement with the Trump administration: The FTC’s case against Google is the “incoherent parsing of competition”
Like many other executives in Silicon Valley, Zuckerberg has recently been ingratiating himself with the Trump administration. Zuckeberg has publicly praised Trump; he donated $1 million to Trump’s inaugural committee; and he’s made company-wide shifts that align with Trump’s priorities, like ending Facebook and Instagram’s fact-checking program and rolling back diversity, equity and inclusion programs.
Zuckerberg has also made several visits to Trump’s Mar-a-Lago club. There has been speculation that Trump could abandon the trial and settle with Meta but so far, all indications point to the case unfolding for many weeks. The start of the trial does not mean that the settlement will take off time. It is possible, though unlikely, that the two sides reach a settlement in the midst of the trial.
Hansen argued that the FTC’s case involves the “incoherent parsing of competition” to make the case that Meta is dominant, when it is merely vying for people’s attention in a crowded online world.
Attorneys made their arguments in front of the District Judge in Washington, D.C., on Monday, which is when the trial will begin.
It is the third time in recent years the federal government has hauled a Big Tech company to court seeking to split up parts of a Silicon Valley business.
The Department of Justice has asked that Google be forced to sell off its popular Chrome browser. A phase of the trial on how to change business to comply with competition is scheduled for April. There is a second case pending which the government alleges that the company illegally monopolizes the market for online ads.
The legal actions against the tech companies underscore a growing public and political skepticism about the business practices of Silicon Valley, as evidenced by the head of the FTC at the time, a tech critic. But even Republicans, and many top Trump officials, believe the tech industry power should be reined in.
Mark Zuckerberg, the founder of Meta, has been enthusiastically embracing himself withTrump in recent months. Trump’s inaugural fund was donated $1 million by Meta. The company paid $25 million to settle a lawsuit against Trump over his social media accounts being suspended after the Capitol riots. And Meta has made company changes that align with Trump’s priorities, including ending a fact-checking program and rolling back diversity, equity and inclusion initiatives.
Meta and the FTC confront off in court over monopoly claims: A counterexample to Zuckerberg’s Facebook antitrust taunt
Andrew Ferguson, Trump’s pick who now heads the agency, has brushed aside speculation that the case would be dropped, telling Bloomberg last month: “We don’t intend to take our foot off the gas.”
The FTC was able to make its case on the basis of Mark’s own words. In an internal email, the CEO of Facebook wrote that he wanted to neutralize a potential competitor. Ahead of Meta buyingWhatsApp in 2014, Zuckerberg wrote an email saying the messaging service represents a large risk for us.
In court, FTC attorney Daniel Matheson said these messages illustrate Meta’s motivation: that it used its size and influence to crush alternative services.
“They decided that competition was too hard,” Matheson said in his opening statement. It would be cheaper to compete with their rivals.
Source: Meta and the FTC face off in court over monopoly claims
Meta is not a monopoly, or is it really a market? The case for improved user experiences in a mobile-operator ecosystem
The argument was that Meta isn’t a monopoly because it has never raised prices on consumers, and that rival apps don’t charge. The amount of time people spent on the platform would be reduced if a company were to charge. “The average American uses more than 40 apps every month,” Hansen said. The app could potentially lose advertising revenue as well.
The quality of Meta’s apps “has improved on every objective measure,” he said, pointing out Meta’s user growth over the years. People use more of something when it becomes better, he said: “That’s economics 101.”