Mark Zuckerberg came to see Instagram's growth as a "threat" to Facebook’s dominance, Instagram cofounder Kevin Systrom has testified during the Federal Trade Commission’s (FCC) landmark antitrust case against Meta.
Last 22 April, Systrom testified that Instagram had the potential to thrive independently and did not require Meta’s infrastructure or resources to scale. He said he believed the company was capable of launching key features like private messaging and video capabilities if it had stayed independent.
Later, during cross-examination by Meta’s lawyers, Systrom acknowledged that Instagram's growth "could have gone either way" but maintained that "the probability of us failing was low."
The testimony is a boost to the FTC's argument that Meta acquired Instagram and later WhatsApp to squash competition and establish an illegal monopoly in the social media market. The FTC has been trying to prove that Instagram was a fast-growing competitor to Facebook that would have grown to a full-fledged rival if it had remained an independent company.
In previous statements, the company has maintained that it contends with a range of social media rivals, including TikTok, YouTube, iMessage, and more. Meta has also argued that Instagram’s explosive growth wouldn’t have been possible without the company’s backing. In court, lawyers for Meta detailed the investments made in building out Instagram’s capabilities.
The company has previously highlighted that Instagram had just 13 employees and no revenue at the time of the acquisition and argued that many of the features central to Instagram today were built with Meta’s technology.
"More than 10 years after the FTC reviewed and cleared our acquisitions, the Commission’s action in this case sends the message that no deal is ever truly final. Regulators should be supporting American innovation, rather than seeking to break up a great American company and further advantaging China on critical issues like AI,” the company said in an earlier statement.
The FTC is seeking to unwind Meta's acquisition deals for WhatsApp and Instagram. If Meta is forced to spin off Instagram, it could be costly for the company’s advertising revenues.
Systrom, who continued to lead Instagram following its acquisition, also said that he felt Meta was "underinvesting" in Instagram and giving it "zero resources."
Several emails released as part of the trial revealed Systrom's frustration with Meta's lack of investment in Instagram, including one sent to former chief technology officer Mike Schroepfer, where he wrote that "we also have areas that are 'starving'" for funds.
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