Facebook insists it would be too difficult and too expensive to split off Instagram and WhatsApp as it faces crackdowns from federal regulators and congressional lawmakers.
The $750 billion social media giant has outlined its arguments against undoing its two marquee acquisitions in a 14-page document, according to The Wall Street Journal.
The document contends that breaking up the popular apps would be extraordinarily hard given that Facebook has made big investments to support their growth and taken steps to integrate their operations, the paper reported Sunday.
Facebook’s plan to merge the chat platforms of Messenger, WhatsApp and Instagram came to light in January 2019 after progressive groups had been lobbying the Federal Trade Commission to split the social media juggernaut into several smaller companies.
The company claims that unwinding its $1 billion Instagram acquisition and $19 WhatsApp purchase would also hurt the user experience, weaken security and force it to spend billions of dollars to maintain separate systems for the apps, the document reportedly claims.
“A ‘breakup’ of Facebook is thus a complete nonstarter,” the document reads.
The details of Facebook’s arguments for keeping its various platforms attached at the hip followed reports that the Federal Trade Commission could bring an antitrust lawsuit against the company by the end of the year.
The House Judiciary Committee’s antitrust panel has also been investigating competition concerns about Facebook along with Google, Apple and Amazon and could release a report on the allegations this week.
While the FTC allowed Facebook’s acquisitions of Instagram and WhatsApp to proceed, the agency has been probing concerns that the Silicon Valley titan uses its dominance in the social-media market to crush competition.
Facebook’s document raised concerns about the FTC challenging the tie-ups after initially clearing them, according to the Journal. Taking such an action after Facebook made significant investments in the deals would “send a disquieting message to the business community,” the company reportedly argued.
The company also argued that the FTC was well aware of emails sent by CEO Mark Zuckerberg in 2012 where he said Facebook would buy Instagram in order to “neutralize a competitor” — a claim he later backtracked on in a later email — and that they did not stop the approval of the deal.
Facebook did not respond to emailed questions about the document Monday. But one antitrust expert told the Journal that the company’s argument against a new FTC action was “surprisingly weak.”
“There is no ‘it’s too hard’ defense,” Tim Wu, a Columbia university professor who supports breaking up Facebook, told the paper, adding that there was “no way a decision on one merger would be preclusive.”
Facebook shares rose 1.8 percent Monday, finishing the day at $264.65.
