A historical antitrust trial that could remodel how the large technological companies in the United States operate were launched on Monday, with Meta Platform Inc. by Mark Zuckerberg facing accusations that he adopted a strategy of “buying or burying” to crush the possible rivals. The case, which could result in the Facebook owner having to uninvert its Instagram and WhatsApp platforms, will take place in a Washington court, DC, DC, in the coming weeks. This is what is at stake for the technological giant, and what could mean for their businesses and operations in the United States and worldwide.
Why is the goal in trial?
In December 2020, the Federal Commerce Commission and 48 General Prosecutors of the State, launched an antimonopoly demand against Facebook, as the company was known, accusing the company of illegal and anti -competitive behavior.
“For almost a decade, Facebook has used its domain and monopoly power to crush the smallest rivals and turn off the competition, all at the expense of everyday users. We are taking measures to defend millions of consumers and many small businesses that have been harmed by the illegal Facebook behavior,” said Letitia James, a general lawyer of New York, who directed the investigation of the United States.
The demands focused on instagram acquisition of US $ 1 billion of US $ 1 in 2012 and the purchase of US $ 19 billion US $ 19 billion two million two years later. The FTC accused Facebook of not competing with the new innovators in the mobile application market, claiming that, instead, “it bought or buried them illegally when their popularity became an existential threat.”
During the trial, the FTC will try to demonstrate that Facebook has maintained a monopoly in the social media space, one that has evolved with the emergence of new participants, such as the application of short video Tiktok. He will try to show that Instagram and WhatsApp purchases of Facebook annulled the competition and that the company subsequently took advantage of the market domination to unfair advertisements and worsen the data privacy rights for users.
What does goal say?
The demand of the FTC against goal is “wrong”, according to the goal lawyer Mark Hansen. The main goal defense is based on trying to establish that the definition of the FTC of the Social Network Applications Market is too restrictive and does not include key competitors such as Alphabet Inc. and Tiktok’s YouTube and Tiktok by Bytedance Ltd. Meta also maintains that the commission cannot demonstrate that US consumers and advertisers are worse due to their acquisitions, and argues that it has improved the new companies that the new companies have improved. “Anyway that you see it, consumers have been the great winners,” said Hansen.
What is at stake for the company?
At stake for the company is its control over the Instagram photo exchange application and the WhatsApp messaging platform, each has more than 2 billion active users. Facebook must uninform both companies to restore market competition, according to the FTC.
Goal is not just a social media company. He has invested at least more than US $ 165 billion in artificial intelligence (AI) and immersive reality initiatives to consolidate his position as a serious deep technology player.
But its lucrative advertising business, of which Instagram is a key taxpayer, remains a great money creator. This year, Instagram is expected to win US $ 32 billion in advertising income from the USA. The American Instagram user base has increased 142 percent to 148 million users in the last decade, says Emarketer.
Will other countries follow your example?
In recent years it has been found in the sights of American and global regulators.
The EU in particular, has forged a difficult position towards the great technology in an attempt to limit the market power and the influence of US technology companies. The European Commission began investigating last year if Meta and Apple Inc. violated the EU digital competence rules. The EU Digital Markets (DMA) Law entered into force in May 2023 and established guidelines for large technology companies in an attempt to create a more fair market and provide European consumers with more options.
The EU will announce its verdict in the coming weeks, with antitrust observers who expect Brussels to repair fines for the two companies for regulatory infractions, according to Reuters. Trump’s trade war has further promoted the EU, with the EU president, Ursula von der Leyen, noting that the block could impose fines on US technology companies if commercial conversations are broken.
Have you earned Trump?
The Meta antimonopoly trial will be its first important test under the second Trump administration. The case of the FTC against Meta began in 2020 during the first mandate of the US President Donald Trump.
The president of the United States threatened to sentence Zuckerberg to “life imprisonment”, claiming that the technology CEO armed Facebook against him during the presidential elections of the United States of 2016.
Citing the legal panorama and changing policies, goal in recent months has made a series of radical changes apparently destined to calm Trump’s criticism to Zuckerberg and Facebook, including the elimination of verification associations and diversity initiatives. Last December, goal donated US $ 1 million to the Trump opening fund. Meta also pressed the Trump administration in recent weeks in an effort to stop the antitrust trial and see the government and the company incorporate an agreement, according to a Wall Street Journal report.
“Regulators should support American innovation, instead of trying to break a large American company and even more advantageing of China on critical issues such as AI,” Meta said in a statement.
• Email: ylau@postmedia.com
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