Facebook’s complex history has been in full focus lately, as the public considers the future of social media and the man responsible for much of the industry’s growth.
Mark Zuckerberg’s journey from Harvard University outcast to founder of Silicon Valley’s hottest tech startup has been a topic of interest since the release of the 2010 drama “The Social Network,” which recounted his complicated story and the founding of Facebook.
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As Facebook’s popularity surged, Zuckerberg began building a social media empire, acquiring some of the most popular startups in the industry. This included purchasing Instagram in 2012 and WhatsApp in 2014, spending $1 billion and $19 billion, respectively.
While this has helped Facebook maintain its dominance, it has also resulted in harsh accusations against the company and legal action. One of Instagram’s founders recently revealed just how far Zuckerberg has been willing to go to stay on top.
Meta Platforms, Inc. CEO Mark Zuckerberg is facing harsh accusations of anti-competitive practices, even from inside his empire.
Image source: Getty Images
A former rival sounds off on Zuckerberg’s leadership
As author Ben Mezrich recounted in his 2019 book, for years, many tech founders built startups with the goal of being acquired by Facebook. In fact, most early-stage founders were willing to turn down venture capital funds from Cameron and Tyler Winklevoss, who sued Zuckerberg over the creation of Facebook, for fear of angering him.
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From the outside, it seemed as though Kevin Systrom and Mike Krieger were living exactly that dream when they sold Instagram to Facebook in 2012 for $1 billion. The two Stanford University graduates had built a startup that took the world by storm, and they sold it for a tremendous profit.
However, Systrom recently revealed the aftermath of the Instagram acquisition, laying out details many people didn’t know. According to his description, Zuckerberg began to starve Instagram of the resources it needed to grow shortly after the deal closed.
As part of the Federal Trade Commission’s (FTC) landmark antitrust case against Meta (META) , Systrom testified that Zuckerberg had opted against investing in Instagram’s growth and success because he saw it as a threat, even after his company acquired it.
“We were by far the fastest-growing team,” he stated. “We produced the most revenue, and relative to what we should have been at the time, I felt like we should have been much larger.”
Systrom noted that he felt Zuckerberg’s action toward Instagram seemed extremely personal, as it had the potential to rival the company he had built.
“As the founder of Facebook, he felt a lot of emotion around which one was better, meaning Instagram or Facebook,” Systrom alleged, adding that he believed human emotion played a key role in Zuckerberg’s decisions.
As an example of Instagram being denied resources, Systrom cited the Cambridge Analytica scandal, in which a British consulting firm harvested the data of millions of Facebook users. Systrom claims that even as the company doubled down on privacy controls, Instagram did not receive any additional staff members.
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Although Systrom did acknowledge that Instagram grew more quickly after being purchased by Facebook than it likely would have as an independent company, he maintained that the platform did not require Meta’s infrastructure to scale its operations and expand into key areas such as private messaging.
Systrom’s testimony could play a pivotal role in the case against Meta
Right now, Meta is in full focus as the FTC antitrust case gets underway. Bloomberg describes Systrom’s testimony as being central to the case against the social media giant, as it could help demonstrate that Meta is a monopoly and is guilty of engaging in anti-competitive practices.
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As the outlet notes, this case centers around the regulatory agency wanting Meta to spin off both Instagram and WhatsApp and being able to convince a judge that this is the best course of action. However, the path to success may be complicated, as the case deals with many hypothetical situations.
“The counterargument lies somewhere in defining an alternative reality,” Bloomberg reports. “Could Instagram have succeeded or grown significantly without Facebook? Systrom says it absolutely could have, but there’s no way to know for sure.”
Systrom isn’t the only figure who has come forward to accuse Meta of unfairly suppressing competition, though. Mark Weinstein, founder of social media network MeWe, recently wrote that Meta targeted his company in an attempt to bury it, likely because it regarded it as a threat.
“Under subpoena, I submitted hundreds of pages of documentation to the FTC, including numerous reports and screenshots from MeWe users showing that their Facebook posts mentioning MeWe were hidden, flagged, or removed,” he states.
Meta has routinely denied that it holds an illegal monopoly, but if these allegations continue to pile up, it may have a hard time denying accusations that it has employed anti-competitive tactics.
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