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    Meta antitrust trial kicks off in federal court

    (www.axios.com)
    431 points c420 | 12 comments | 14 Apr 25 13:18 UTC | HN request time: 0.233s | source | bottom
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    henryfjordan ◴[14 Apr 25 19:16 UTC] No.43685057[source]▶
    > "The FTC's lawsuit against Meta defies reality. The evidence at trial will show what every 17-year-old in the world knows: Instagram, Facebook and WhatsApp compete with Chinese-owned TikTok, YouTube, X, iMessage and many others," Meta spokesperson Chris Sgro said in a statement.

    Everyone knew at the time that Facebook bought Instagram because it threatened Facebook's dominance, and hindsight shows that exactly that happened. There's a huge swath of people that dropped off FB and now use Insta, but Meta owns both. It was a great move but it was absolutely anti-competitive at the time.

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    1. jjallen ◴[14 Apr 25 21:31 UTC] No.43686547[source]▶
    This implies that every horizontal acquisition is anti-competitive, does it not? If not I would love to read why not.
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    2. michaelt ◴[14 Apr 25 21:39 UTC] No.43686616[source]▶
    If there are 7 different grocery stores in driving distance of my house and two of them merge, I've still got a choice of 6 stores so there's still reasonable competition.

    If there are 3 different grocery stores and two of them merge, though? That's a different matter.

    And if 1 of the remaining 2 is the zero-waste organic store that only rich people and hippies use? It might not even be providing all that much competition.

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    3. henryfjordan ◴[14 Apr 25 21:48 UTC] No.43686688[source]▶
    Yes, every horizontal acquisition is anti-competitive.

    Antitrust violations are a higher bar, you must improperly flex your dominant market position to violate the law. For that the government would have to show that FB offered an unreasonable price that nobody sane would match or that they threatened to cut off Insta links from FB if they didn't sell, something like that.

    4. ensignavenger ◴[14 Apr 25 21:59 UTC] No.43686775[source]▶
    There are far, far, far more than just 7 photo sharing apps/websites within the same number of clicks as Facebook and Instagram.
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    5. snovymgodym ◴[14 Apr 25 22:06 UTC] No.43686817[source]▶
    Yeah, but we're talking about 2012. Instagram was small and wasn't making any money, and feature-wise it barely resembled what it is today. Going just by US sites in 2012 Twitter, Tumblr, Snapchat, Google+, Pinterest, YouTube, and Reddit were all large competing social networks (or social network adjacent sites/apps).

    Seems like in your analogy there were plenty of grocery stores left.

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    6. immibis ◴[14 Apr 25 22:27 UTC] No.43686964{3}[source]▶
    Didn't they give kids a free VPN service then use it to spy on which apps they used the most, to predict who their next competitor would be?
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    7. AnthonyMouse ◴[14 Apr 25 22:37 UTC] No.43687057{3}[source]▶
    The thing that makes something a competitor is the ability to act as a substitute. That means grocery stores that are 1000 miles away don't count. For photo sharing, what makes something a viable substitute is having a sufficient network effect, so photo sharing services with hundreds of users aren't a substitute for ones with millions.

    This implies that mergers between large services that have a network effect should always be prohibited, but why is that even a problem unless your goal is to thwart competition?

    It would also create a useful incentive: Federated systems (like email) have a single network that spans entities. If Microsoft wants to buy Hotmail, they're not buying a separate network so you don't have to be worried about it even if they each have 25 million users as long as that's not too large a percentage of the billion people who use email. So then companies would want to participate in federated systems instead of creating silos like modern social networks do, because then they would be as strictly prohibited from doing mergers.

    8. ◴[14 Apr 25 23:41 UTC] No.43687477{4}[source]▶
    9. sudahtigabulan ◴[14 Apr 25 23:49 UTC] No.43687526{4}[source]▶
    They did, apparently since 2016.

    https://techcrunch.com/2019/01/29/facebook-project-atlas/

    10. _aavaa_ ◴[14 Apr 25 23:54 UTC] No.43687576[source]▶
    Not always. Say you have 4 cell phone carriers. 2 clearly on top and 2 far behind. The two weak ones merging would, on paper, take you from 4 companies to 3. In reality you go from 2 options to 3.
    11. jjallen ◴[15 Apr 25 00:16 UTC] No.43687709[source]▶
    There weren’t only 3 social networks and they are not impossible to replicate (like cellular networks with limited spectrum).
    12. input_sh ◴[15 Apr 25 10:18 UTC] No.43690959{3}[source]▶
    That's because it was still an iOS-exclusive.

    People forget that the Android app and the aquisition announcement came out like one week apart. The basic web version didn't come out until half a year later.

    My point is it already had a solid rich, influencer-y userbase + was about to become available on more platforms. Aquisition definitely had an impact on the user growth, but the growth itself was already inevitable.