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Meta’s Mark Zuckerberg conceded Tuesday that he bought Instagram because it was “better” than Facebook’s own camera app – a potentially major admission on the second day of the FTC’s landmark trial to break up the social media giant.
Zuckerberg returned to the stand in US District Court in Washington, DC, where FTC attorneys focused on smoking-gun emails from Zuckerberg to his Facebook underlings around the time of the 2012 acquisition of Instagram.
When pressed on whether he was concerned that Instagram’s growth posed a threat, Zuckerberg admitted he felt the it had built a better photo app than what Facebook had in development.
“Building a new app is hard,” Zuckerberg said.
“We’ve probably tried building dozens of apps over the history of the company, and the majority of them don’t go anywhere.”
Zuckerberg dodged questions about whether Meta, then called Facebook, was trying to crush a competitive threat to his company.
“We were doing a build vs. buy analysis,” Zuckerberg said. “I thought that Instagram was better at that, so I thought it was better to buy them.”
The FTC alleges that Meta utilized a “buy or bury” strategy to acquire key rivals Instagram and WhatsApp in order to prevent them from challenging its entrenched monopoly over social media.
It seeks to to force Meta to spin off Instagram, which it acquired for $1 billion in 2012, and WhatsApp, bought for about $19 billion in 2014.
The feds highlighted one 2012 email exchange in which Zuckerberg acknowledged to ex-CFO David Ebersman that buying Instagram would effectively “neutralize a competitor.”
“One way of looking at this is that what we are really buying is time,” Zuckerberg added in the exchange. “Even if some new competitor springs up, buying Instagram, Path, Foursquare etc. now will give us a year or more to integrate their dynamics before anyone can get close to their scale again.”
A separate exchange from 2012 showed a frustrated Zuckerberg putting pressure on former Facebook Chief Operating Officer Sheryl Sandberg over fears that WhatsApp was outcompeting Facebook Messenger, its own chat service.
“Messenger isn’t exactly beating WhatsApp, Instagram was growing so much faster than us that we had to buy them for $1 billion,” Zuckerberg said in the email to Sandberg. “That’s not exactly killing it.”
The FTC also highlighted several damning emails exchanged by Zuckerberg during its opening statement, including a 2012 message where he admitted that “Instagram could hurt us meaningfully” and is “pretty threatening to us.”
In another 2008 email that has drawn scrutiny, Zuckerberg said “it is better to buy than compete.”
On the witness stand, Zuckerberg tried to push back on the FTC’s assertion that Facebook bought Instagram solely because of its surging user base.
“It’s not accurate to say that the only reason we were interested was the scale or growth rate,” Zuckerberg said.
“We could have built an app,” he added. “Whether it succeeded or not is a matter of speculation.”
Meta shares were flat in Tuesday trading.
The FTC’s case could hinge on whether it can convince Judge James Boasberg in the non-jury trial that their definition of Meta’s market is accurate.
Sandberg is expected to appear on the stand as soon as Wednesday. Other high-profile upcoming witnesses include Instagram co-founder Kevin Systrom and current Instagram chief Adam Mosseri.
A potential loss of Instagram is seen as particularly dangerous for Meta because the photo-sharing app accounts for more than half of its US-based ad revenue.
In previous testimony on Monday, Zuckerberg resisted FTC’s attempt to define Meta as dominant among social media firms that are built on sharing between friends and family.
“The ‘friend’ part has gone down quite a bit but it’s still something we care about,” Zuckerberg said.
During its opening statement, the FTC argued that the only direct competitors to Meta-owned Facebook and Instagram are Snapchat and a little known, privacy-focused app called MeWe. Other platforms like video-focused TikTok and professionally-focused LinkedIn are in distinct categories, according to the feds.
Meta’s lawyers fired back, asserting that the FTC was wrong to exclude the fierce competition it faces from the likes of TikTok and YouTube for user attention.
Zuckerberg went to great lengths to cozy up to President Trump ahead of the trial as he sought to avoid the FTC trial with a settlement.
Aside from donating $1 million to Trump’s inauguration fund and attending his swearing-in ceremony, Zuckerberg eliminated fact-checking and DEI programs that the president’s allies have widely criticized.
The billionaire also purchased a mansion in Washington DC and has reportedly personally visited the White House at least three times since January.
With Post wires
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