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431 points c420 | 22 comments | | HN request time: 0.002s | source | bottom
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paxys ◴[] No.43685386[source]
I don't understand the FTC's strategy here. Their entire case hinges on the fact that the judge will accept that Instagram, WhatsApp, Snapchat and MeWe (?) are direct competitors of Facebook in the "personal social networking" space while TikTok, YouTube, X, iMessage and all the rest aren't. Unsurprisingly that is what Meta's legal team is spending all of its efforts debating. I really can't see the judge allowing such a cherry-picked definition of what Facebook's market is.
replies(5): >>43685882 #>>43685979 #>>43686698 #>>43687240 #>>43688004 #
whatshisface ◴[] No.43685979[source]
The definition of a trust isn't a business with no competitors. In fact, a business with no competitors is legal. Antitrust law limits "anti-competitive actions," which are possible even for commodity producers in an efficient market.
replies(2): >>43687242 #>>43688729 #
1. the_clarence ◴[] No.43687242[source]
Exactly! So what is anti competitive here?
replies(3): >>43687418 #>>43687485 #>>43688611 #
2. karaterobot ◴[] No.43687418[source]
The government has alleged that Meta's acquisition of WhatsApp and Instagram was done to reduce competition. Nothing has been established as anti-competitive or not yet, that's why it's in court. Evidence from both sides will be presented. I'm not sure how else to answer that question.
replies(1): >>43689414 #
3. stackskipton ◴[] No.43687485[source]
Facebook knew that Instagram was up and coming and instead of competing, it just bought it.

You can read more about initial complaint and following the trial here: https://www.bigtechontrial.com/p/zuckerberg-on-the-stand-the...

replies(2): >>43688698 #>>43695321 #
4. ezfe ◴[] No.43688611[source]
Buying a rising product to make sure you control it instead of needing to compete with it is not legal when you're the size of Facebook.
replies(1): >>43695344 #
5. DecentShoes ◴[] No.43688698[source]
Isn't this the purpose of most acquisitions?
replies(3): >>43688790 #>>43692631 #>>43692984 #
6. callc ◴[] No.43688790{3}[source]
If the purpose of an acquisition is to quash competition that is bad. Monopolies are bad.

Another purpose of acquisitions is to acquire a new capability that you could not do in house that you do not already compete on.

replies(1): >>43688825 #
7. dmix ◴[] No.43688825{4}[source]
Instagram was and still is in a highly competitive market. Previously it was Snapchat at the time and now it's Tiktok. Not to mention YouTube shorts, Reddit, Twitter, and every other service focused on video and pictures.

I don't think any social media consumer is lacking choice.

replies(1): >>43689038 #
8. callc ◴[] No.43689038{5}[source]
Regardless of how much “choice” there is in a market, FB made an anti-competitive play. Now we all have n-1 choices.

The question of whether society should allow companies to perform anti-competitive actions should not be “will we be left with enough choices?”, but should be “is this an anti-competitive action?”

9. tyre ◴[] No.43689414[source]
Zuckerberg in writing said that instagram was purchased to prevent them from competing.

Many things have been established.

replies(2): >>43689626 #>>43713382 #
10. lazide ◴[] No.43689626{3}[source]
It’s perfectly fine to do anti-competitive actions. They’re fundamental to most businesses survival, actually.

It’s not fine to do them to create, expand, protect, attempt to create, etc. monopolies.

So essentially, you can be anti-competitive only to the point where you’ve been too successful at it, then it’s bad.

replies(1): >>43690193 #
11. n4r9 ◴[] No.43690193{4}[source]
Anti-competitive behaviours such as price-fixing and over-broad no-compete clauses can be problematic even without a monopoly.
replies(1): >>43690364 #
12. lazide ◴[] No.43690364{5}[source]
Fair point, though they typically only become problematic (aka are acted on/legislated against) when they significantly distort the market to a degree people start really complaining about it.

Usually due to either a monopsony/cartel/monopoly which controls most of the market doing it successfully.

If the companies in the lower 5% of a market price fix or the like, no one usually cares. Even 20%, usually.

The Sherman antitrust act speaks about ‘restraints of trade’ because it has to actually restrain trade, which requires a significant degree of control - which a successful/actual monopoly, monopsony, or cartel can do.

Technically, even attempting to do it is illegal, but going after every company that tries has a bit of the same feel as locking up every single toddler because they took a swing at someone or threatened them with their cute little stubby kid scissors.

It’s a waste of resources, not in anyone’s interest, stops behavior most people would consider necessary/healthy to some degree, causes much worse problems than it solves, etc.

On the other hand, locking up a successful serial killer is just good public policy.

The difference between the two is more a matter of the success and effectiveness of their tactics, not really intent.

replies(1): >>43690937 #
13. n4r9 ◴[] No.43690937{6}[source]
Generally agree. There are some subtle edge cases like price dumping, but even that's still ultimately an attempt to gain market dominance.
14. reaperducer ◴[] No.43692631{3}[source]
Isn't this the purpose of most acquisitions?

No, it's not. It is not normal or usual. Not even in the tech industry.

15. blululu ◴[] No.43692984{3}[source]
A true accounting of board level corporate motivations is not available. The standard line is typically something like “we are acquiring our smaller rival to more effectively compete with our larger rival”. I.e “we are acquiring a small desktop publishing start up to compete with the largest cloud computing provider”. Or in this case: “we are acquiring a small photo sharing company to compete against Google/Youtube”.
16. the_clarence ◴[] No.43695321[source]
Are we talking past each other? How is that anti competitive? This is literally the opposite: they embraced and validated their competitor by making them a huge offer, showing that it pays off to compete
replies(1): >>43695422 #
17. the_clarence ◴[] No.43695344[source]
Isnt this inviting to competition? You can make a big exit by competing and getting acquired
replies(1): >>43696936 #
18. AnimalMuppet ◴[] No.43695422{3}[source]
And once they bought them, then Instagram wasn't a competitor any more. That's how it's anti-competitive.
replies(1): >>43713378 #
19. ezfe ◴[] No.43696936{3}[source]
Well - it invites people creating big promises and then selling, which doesn't help the consumer.
replies(1): >>43713383 #
20. the_clarence ◴[] No.43713378{4}[source]
I disagree that it is anti competitive, it is not "killing" competition. Killing competition is setting prices that makes the competition go bankrupt, it's assassinating people, it's pushing for changes that prevent the competition from working in the same environment, etc. here nothing prevented instagram from saying no and getting bigger.
21. the_clarence ◴[] No.43713382{3}[source]
Its not the same as forcing them to shut down or say yes. They wanted one less competitor yes, as every company does, but they didn't prevent the company from growing and existing.
22. the_clarence ◴[] No.43713383{4}[source]
IMO the consumer wins if there's a single social network