FTC’s landmark case against Meta over Instagram, WhatsApp acquisitions could reshape antitrust law

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A milestone trial starts on Monday as the Federal Trade Commission (FTC) sues Meta Platforms Inc., alleging the technology giant suppressed competition by buying Instagram and WhatsApp using a "buy or bury" tactic, the New York Times reported.

The case, FTC v. Meta Platforms, is the most substantial antitrust test of Big Tech during President Donald Trump's presidency, a test of whether the laws of decades past can be used to break up tech monopolies in today's digital era.

The heart of the FTC's case

At the center of the FTC's case is a new interpretation of Section 2 of the Sherman Antitrust Act, alleging Meta violated the law by buying up smaller competitors to snuff out competition before it could become large. The agency argues that Instagram and WhatsApp, when bought in 2012 and 2014 respectively, were budding threats that Meta disarmed by acquiring them.

The FTC is seeking to compel Meta to divest both platforms, a move the company aggressively resists. "It is better to buy than compete," the agency quotes Mark Zuckerberg as saying in a 2008 email — one of a number of internal documents that will be presented as evidence of anti-competitive intent.

Meta's response: It's a competitive market

Meta, on its part, insists that the deals were legal and okayed by regulators back then. It cites the emergence of TikTok, Snap, and other apps as proof of an active and competitive social media space.

Meta spokesman Chris Sgro stated the agreements "have been good for competition and consumers" and condemned the FTC's effort to "punish businesses for innovating." Zuckerberg, the CEO, and ex-COO Sheryl Sandberg are scheduled to testify, as well as the creators of Instagram and WhatsApp.

Implications for Silicon Valley and Trump's antitrust legacy

This is the first big tech monopoly case to be tried during the Trump administration, after lawsuits against Google, Apple, and Amazon. Andrew Ferguson, Trump's appointee to head the FTC, has promised to keep up aggressive action against tech giants, citing both market power and concerns over political censorship.

A government victory could set a precedent for breaking up mergers that previously were deemed to be legal, turning Silicon Valley's perception of acquisitions upside down. To start-ups and investors, it would make the attractiveness of buyouts by larger companies less appealing, historically regarded as an exit strategy.

Difficult legal ground

Judge James Boasberg, presiding over the trial, has been critical of the FTC's case, saying that it "strains this country's creaking antitrust precedents." Legal analysts point out that establishing that Meta would not be so dominant without the acquisitions involves a counterfactual that is hard to prove.

Jennifer Huddleston of the Cato Institute added, "It's asking a judge to determine whether Meta attempted to destroy competition or was lucky and made a good guess."

A long road ahead

Since Meta's apps are now so highly integrated, forced breakup would entail both legal and technical challenges. But the ruling in this trial could radically shape the future of digital competition — and determine just how far government can go to break up tech giants' sway.