Zuckerberg Could Be Forced to Sell WhatsApp, Instagram if He Loses FTC Case: Reports
In a significant development, Meta CEO Mark Zuckerberg could face the possibility of being forced to sell Instagram and WhatsApp if he loses a case filed by the US Federal Trade Commission (FTC) against his firm. The FTC has alleged that Meta acquired Instagram and WhatsApp to eliminate competition, effectively giving itself a monopoly in the social media space.
As per reports, the FTC is seeking a court order to force Meta to divest the two popular messaging apps. The antitrust trial is set to begin in September, and experts are weighing in on the potential implications of the case.
The FTC alleges that Meta’s acquisition of Instagram in 2012 and WhatsApp in 2014 was anticompetitive, as it would allow the company to control a significant portion of the social media market. The regulator argues that this would stifle innovation and reduce consumer choice.
Meta, on the other hand, has denied the allegations, stating that it faces ample competition in the social media space and that regulators approved the acquisitions at the time. In a statement, the company said: “We believe the evidence will show that our acquisitions of Instagram and WhatsApp were lawful and pro-competitive, and that the harms alleged by the FTC are purely speculative.”
However, experts are divided on the issue. Some argue that the FTC has a strong case, citing the significant market share that Meta now holds in the social media space. “The FTC has a valid concern that Meta’s acquisition of Instagram and WhatsApp has reduced competition and stifled innovation in the social media space,” said Dr. Michael A. Carrier, a professor of law at Rutgers University.
Others, however, believe that the FTC’s case is weak and that Meta has done nothing wrong. “The FTC’s allegations are baseless and are an attempt to second-guess the competitive effects of these acquisitions,” said Dr. Joshua Wright, a professor of law at George Mason University.
If Meta is forced to divest Instagram and WhatsApp, it could have significant implications for the company’s business model. The two apps are major revenue drivers for Meta, and their sale could result in a significant loss of revenue.
However, some experts believe that the potential financial impact could be mitigated. “While the divestiture of Instagram and WhatsApp would be a significant blow to Meta, the company has a diverse range of businesses and could likely absorb the loss,” said Dr. David T. Scheffman, a professor of economics at New York University.
The antitrust trial is set to begin in September, and the outcome is far from certain. However, if Meta is forced to divest Instagram and WhatsApp, it could have significant implications for the social media landscape and the way that companies operate in the digital space.
Source:
