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During a high-profile antitrust trial observed on Tuesday, it was revealed in court that Mark Zuckerberg had considered the prospect of separating Instagram from Meta, according to his emails. This trial poses a potential risk of leading to the dismantling of the technology conglomerate.
A confidential email from 2018, submitted as evidence by the US Federal Trade Commission (FTC), indicated that Zuckerberg had communicated to senior executives at Meta that the growing calls for breaking up major tech companies could potentially necessitate spinning out Instagram and possibly WhatsApp within five to ten years. He expressed doubts about the feasibility of maintaining these applications under one roof.
Zuckerberg had foreseen Washington’s bipartisan opposition against Big Tech as the FTC began presenting its argument that the social media corporation functions as an illegal monopoly. This initiative could lead to a mandated breakup of Meta, valued at $1.5 trillion. The antitrust regulator, committed to intensifying its scrutiny of Big Tech during Donald Trump’s second presidency, accused Meta of suppressing emerging competition by acquiring Instagram and WhatsApp in 2012 and 2014 for $1 billion and $19 billion, respectively, and requested the reversal of these transactions. Meta has refuted these allegations.
The 2018 email from Zuckerberg was penned as Meta deliberated on the potential restructuring implications following the acquisitions. The company was also concerned about Instagram’s rapid growth possibly leading to a “network collapse” of Facebook, which was more profitable at the time. Zuckerberg mentioned in the email the reduction of promotional activities directing traffic from Facebook to Instagram in response to these concerns.
In court, Zuckerberg indicated that the group was then grappling with “operational difficulties” in managing its diverse apps, with Facebook being tasked with supporting Instagram’s expansion. He admitted that resource management was unbalanced at the time within the company, prompting him to consider whether Instagram should be spun off as an independent company. Such a move could achieve several significant objectives, including reducing interdependencies between teams developing apps and halting the artificial growth of Instagram to the detriment of Facebook’s networks.
Zuckerberg believed this step could help retain Instagram’s founder, Kevin Systrom, ensuring the platform’s optimal performance. He clarified in court that he was referring to inefficiencies arising from being unable to openly discuss strategic plans, which risked demoralizing Systrom or the Instagram team. Systrom left the company in September 2018, as Facebook tightened its control over Instagram, and he did not immediately respond to requests for comment.
Zuckerberg noted in the 2018 email that while many companies resist breakups, historically, most firms tend to perform better after being split up. When the FTC lawyer inquired about his reference to “corporate history,” Zuckerberg was unable to recall specific details. However, he clarified in the email that he was not advocating for this action at the time but urged consideration of the possibility that the family of apps they intended to build might not be sustainable in its existing form.
Additional reporting was provided by Hannah Murphy from San Francisco.