To Be Clear, Instagram Was Acquired to Eliminate a Competitor, and That Was Fine With the FTC ⇥ theverge.com

Casey Newton and Nilay Patel, the Verge, in July 2020:

It’s a combination of neutralizing a competitor and improving Facebook, Zuckerberg said in a reply. “There are network effects around social products and a finite number of different social mechanics to invent. Once someone wins at a specific mechanic, it’s difficult for others to supplant them without doing something different.”

[…]

Forty-five minutes later, Zuckerberg sent a carefully worded clarification to his earlier, looser remarks.

You have read these emails before, I am sure, but I think it is worth a reminder post-trial.

The latter email was written for the very circumstance of this thread being found. You have to imagine that, in the forty-five minute break after which Zuckerberg replied to himself to clarify he did not actually intend to write the illegal thing, he chatted with the CFO — to whom he was emailing his plans to do illegal things — and maybe some lawyers, and they advised him it might look bad if regulators looked at this.

Barbara Ortutay, the Associated Press, earlier this week following the results of the trial:

During his April testimony, Zuckerberg pushed back against claims that Facebook bought Instagram to neutralize a threat. In his line of questioning, FTC attorney Daniel Matheson repeatedly brought up emails — many of them more than a decade old — written by Zuckerberg and his associates before and after the acquisition of Instagram.

While acknowledging the documents, Zuckerberg has often sought to downplay the contents, saying he wrote the emails early in the acquisition process and that the notes did not fully capture the scope of his interest in the company. But the case was not about the acquisitions of Instagram and WhatsApp more than a decade ago, which the FTC approved at the time, but about whether Meta holds a monopoly now. Prosecutors, Boasberg wrote in the ruling, could only win if they proved “current or imminent legal violation.”

To describe his in-trial response as “push[ing] back” and “downplay[ing]” is, I think, charitable. Zuckerberg acknowledged the company struggled to build competitive apps independently.

The FTC could have reviewed these frank and incriminating emails when it approved the acquisition in 2012. Yet, to repeat myself, it approved the acquisition anyhow. The United States has, since the mid-1970s, exercised a pretty weak enforcement of its antitrust laws compared to the way it policed corporate size before. It allowed this kind of stuff to happen in the first place, where one goal of the acquisition was explicitly to eliminate competition. Whether Instagram would exist today as an independent company is a great hypothetical question, and the FTC could have laid the groundwork to answering it in 2012.