The Economist: Why Meta should win the antitrust fight

Key topics:Meta faces FTC in high-stakes antitrust trialFTC's narrow market definition excludes key rivalsTikTok’s rise undermines monopoly claims against Meta.Sign up for your early morning brew of the BizNews Insider to keep you up to speed with the content that matters. The newsletter will land in your inbox at 5:30am weekdays. Register here.Support South Africa's bastion of independent journalism, offering balanced insights on investments, business, and the political economy, by joining BizNews Premium. Register here.If you prefer WhatsApp for updates, sign up to the BizNews channel here..From The Economist, published under licence. The original article can be found on www.economist.com© 2025 The Economist Newspaper Limited. All rights reserved..The Economist .The $23m pied-à-terre that Mark Zuckerberg bought last month in Washington, DC, is a seven-bathroom testament to Meta’s devotion to lobbying. As well as donating $1m to Donald Trump’s presidential-inauguration fund and shelling out $25m to settle a spurious lawsuit from the president, Meta has MAGAfied its board, appointing allies such as Dana White and, last week, Dina Powell, who served in Mr Trump’s first administration (John Elkann, the boss of Exor, which part-owns The Economist’s parent company, is also a director). Mr Zuckerberg has dined at Mar-a-Lago and visited the White House.The reason for this frantic schmoozing is a blockbuster antitrust trial that began on April 14th and which threatens to break up Mr Zuckerberg’s $1.3trn empire. The stakes are high and the politics are low. But what matters is that the claim the Federal Trade Commission (FTC), America’s competition watchdog, has brought against Meta deserves to fail.The complaint, launched in 2020, alleges that Meta (then called Facebook) illegally maintained its social-media monopoly when it bought Instagram and WhatsApp, two smaller rivals, several years earlier. Though the FTC approved both transactions at the time, it now wants them undone. To establish that Meta is a monopolist, the trustbusters have described its market as “personal social networking”. This is a tendentiously narrow definition that excludes obvious rivals such as X, LinkedIn, Pinterest and Reddit. On this view, the world’s biggest social-media company competes only with Snapchat, a much smaller rival, and MeWe, an even tinier one.The FTC’s argument was never compelling, and in the years since the complaint was filed it has only become less persuasive. Despite the FTC’s claim that network effects create insurmountable barriers to entry, the past few years have seen a rush of successful social-media startups. Some have fizzled, like Clubhouse and BeReal. Others remain small, such as Bluesky and Mr Trump’s own Truth Social. But the arrival of TikTok, which has attracted more than 1.5bn users worldwide, makes a mockery of the idea that the market is closed.Read more:.Zuckerberg predicts 2025 breakthrough for Meta’s AI.Competition has intensified in other ways, too. Thanks partly to TikTok’s innovation, social apps now revolve around video. That has pitched Meta into competition with giants such as YouTube, whose “Shorts” feature mimics the TikTok-like vertical clips that also play on Facebook and Instagram. Moreover, once-distinct media markets are converging. Spotify, originally a music service, is pushing into video; Roblox, a gaming platform, acts as a social network for many teenagers. As competition spreads across previously separate categories, the FTC’s narrow market definition looks ever sillier.What of the experience for consumers, whose interests the FTC exists to defend? The regulator argues that a shortage of competition has created worse products, citing an overload of ads on Meta’s apps. But the idea that consumers have been poorly served by the social-media market in recent years is hard to square with the hours of extra time they are devoting to it. By one estimate nearly half of all mobile screen time worldwide is spent browsing social media (and about a quarter of all waking hours are spent on phones).Ask a parent if they have any concerns about social media and they will chew your ear off, but they are unlikely to complain that their child is short of social apps. Indeed, consumers’ behaviour suggests that—for better or worse—they have seldom encountered a market they find so captivating.The shaky case has come to trial at an appropriately farcical moment. As the FTC sets out its claim that Meta faces insufficient competition, the firm’s main rival, TikTok, hangs in legal limbo. Distribution of the Chinese-owned app in America has been outlawed since the beginning of Mr Trump’s presidency. But he has ordered the authorities to ignore the ban—for 75 days, then 150—while he negotiates the app’s sale to an American buyer. No one has the faintest idea whether the app will still be around by the time Meta’s trial is over. How can any serious judgment on competition in social media be made without knowing the fate of TikTok, its greatest disruptive force?What began as a thin case has become progressively weaker, and now looks downright absurd. The court should waste no time in swiping it up and away.

The Economist: Why Meta should win the antitrust fight

Key topics:

From The Economist, published under licence. The original article can be found on www.economist.com

© 2025 The Economist Newspaper Limited. All rights reserved.

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