Meta’s Win Over FTC Is a Victory For Small Businesses
In rejecting the Federal Trade Commission’s (FTC’s) monopoly claims against Meta, U.S. District Judge James Boasberg delivered not only a major win for the company, but a significant victory for the millions of small businesses that leverage leading tech companies’ integrated digital tools and platforms to find customers, grow, and succeed.
The FTC’s case rested on the argument that Meta, the parent company of popular social media platforms Facebook, Instagram, and WhatsApp, boxed out would-be competitors in the “personal social networking” (PSN) market — an unrealistically narrow market defined by the FTC for the purposes of its argument.
The FTC sought to prove that Meta had insulated itself from competition within the PSN market by creating market barriers that made it impervious to competitive threats. As the trial unfolded, however, it became clear that Meta’s successful apps in fact catalyzed fierce competition from the likes of TikTok, YouTube, WeChat, X, and Reddit. As millions of small businesses know, that competition spurred enormous innovation in the industry, creating valuable new advertising, messaging, and analytics services — many of which are free of charge.
“Meta’s apps have continuously improved,” Judge Boasberg wrote, noting that industry rivals had “…forced Meta to invest gobs of cash to keep up.” Meta, he concluded, “is not a monopolist insulated from competition.” In short — and as millions of users could likely attest — the social media market is working exactly like a healthy, competitive market should.
Most immediately, the ruling means small businesses can continue using Meta’s platforms to affordably and effectively reach customers and market their products. But the ruling also sets a critical precedent for other FTC lawsuits — based on similar arguments and narrowly defined markets — targeting other companies that empower small businesses to succeed.
Case in point: The FTC is suing Amazon, alleging that the retailer has monopolized the market for tools and services that sellers use to sell online. But Amazon’s success continues to spur fierce competition within the online retail sector — leading to improved service and lower prices for small sellers and consumers. Today, small sellers typically sell through multiple retail channels, each vying for small businesses’ dollars by offering sophisticated new features. From major retailers like Home Depot, Costco, and Wayfair to unique online shops powered by e-commerce tools like Shopify, Squarespace, and Wix, small businesses have more options than ever for reaching the right audiences — allowing them to grow with unprecedented efficiency.
Indeed, Boasberg’s verdict may serve as a warning to the FTC as it prepares for the Amazon case. “The court didn’t just disagree with the FTC,” noted tech-industry trade group Chamber of Progress, “it rejected the case’s basic architecture: the market definition [and] the theory of monopoly power.”
Boasberg’s verdict should come as hopeful news for the U.S. small businesses that sell their goods on Amazon. Hopefully, the FTC will understand the fundamental flaws in its current approach and look to resolve its case against Amazon. Doing so would provide important stability to small businesses across the country. At the same time, it would help ensure that innovation in digital sales-tools and online retail continues — allowing sellers to grow their businesses through a variety of brick-and-mortar and online channels.
Judge Boasberg’s Meta decision acknowledged what small businesses experience every day: a digital marketplace defined by constant change and real competition. By affirming that reality, the decision may help ensure that small businesses continue to benefit from the innovative, low-cost tools — offered by leading tech companies — that help them reach customers, scale, and succeed.
