The Current - Could Mark Zuckerberg be forced to sell Instagram and Whatsapp?

Episode Date: April 24, 2025

Meta and Google have been hit with landmark antitrust trials recently, centred on allegations of operating illegal monopolies. The CBC’s Nora Young breaks down what this might mean for the power of major tech companies, and the people who use their platforms every day. 

Fisherman John Coppock and his son Craig were hoping that their day on the water would finish with a good haul of cod. Instead, they reeled in way more than they bargained for. They had a net filled with fish and to their horror and surprise, the body of a man. I'm Kathleen Goldthar and this week on Crime Story, a body in the ocean untangles a CBC Podcast. Hello, I'm Matt Galloway and this is The Current Podcast. Big tech is facing some big battles right now. A series of antitrust cases aiming to curb the power of major tech companies. A landmark trial in the United States against Meta is in its second week. The US Federal Trade Commission is arguing that Meta's ownership of Instagram and WhatsApp is an illegal monopoly.

It's been a tough week for Meta. Yesterday, the European Union hit Meta and Apple with fines totaling about 700 million euros. That's just over a billion dollars Canadian for breaking fair competition rules. Last week, Google lost a second antitrust case. Here to sift through it all is Nora Young, senior technology reporter with the CBC's visual investigations unit. Nora, good morning.

Good morning, Matt. Meta. Yeah. Bad news. What exactly is the FTC accusing Meta of doing and being? So the claim is that Facebook as it was then bought up Instagram and WhatsApp specifically in order to squash the competition.

This is going back more than 10 years, 2012, 2014. And the argument turns on the idea that Facebook is primarily a platform for exchanging information amongst friends and families. So by buying up these two, they were crafting a strategy to eliminate the competition in that specific social networking space. Mark Zuckerberg, big boss of Metta, did not want to be on the stand,

but he was there testifying. What did he say about this idea that Meta is a monopoly? Yeah, I mean, he said basically that these were sound business decisions based on being easier to buy rather than build something from scratch. So in one exchange that got picked up a lot about buying Instagram, he talked about how much better their camera and photo sharing was, you know, saying we could have built an app, but whether it succeeded or not is a matter of speculation. So really making the argument, nothing to see here folks, but government lawyers have Zuckerberg's emails from that time that paint a different picture, including one where Zuckerberg literally says that buying Instagram might quote,

neutralize a competitor. Not the kind of thing that you want to have invited. So there's that, Matt. And the expert we heard from in a little bit talked about two Zuckerbergs, the email Zuckerberg and the Zuckerberg who's testifying live. What does that tell you about the FTC's possibility of winning this case?

I mean, experts, everyone's paying attention. Everyone is, yeah. And it's pretty divided. Some people feel that the argument that Metta's legal team is making is that the digital media environment today is like, look, how competitive it's incredibly competitive. Our competition includes TikTok, YouTube, Apple's iMessage, but the FTC is maintaining

this position that communicating with friends and family is the core of what Facebook and Instagram and WhatsApp are for. So it's partly a question about what kind of business is Metta actually. And I spoke to Tim Wu, who's a law professor at Columbia, and I know he's been on your show. He has, yeah. His take is that while it's a challenge that these events in question happened over 10 years ago,

he thinks the fundamentals of the FTC case are strong, but the stakes are really high, Matt, because if Metta loses this, they're probably going to have to sell off WhatsApp and Instagram, which is a big part of their business. It certainly is. Yeah. Yesterday, as I mentioned, the European commission, which is an arm of the EU, hammered Apple and Metta with these big fines. What are the, I mean, big dollar figure, what are the fines for?

Well, basically that they violated EU's digital markets act, which are a bunch of provisions that are aimed at ensuring that smaller digital players can find a place in the market. So it's part of the EU's overall attempt to kind of put limits around big tech. The companies have responded really strongly to this, unsurprisingly. Apple saying it's being discriminated against. Metta saying the EU is going after successful American businesses while letting Chinese and European companies continue. So maybe wrapping themselves in the American flag a little at this time of international economic tension.

It was interesting. Mark Zuckerberg was on the Joe Roggenpagg pass not so long ago and was hinting, suggesting that maybe Donald Trump would take up that American flag fight, saying, you know, this is a way to protect successful American companies. Yeah. And this is interesting. It's not that long ago that the big tech companies were like donating lavishly to Trump's inauguration

fund. They might want something back for that. Yes, it doesn't seem to be turning out that way. Google lost its second antitrust case last week. What does this mean for the future of Google? A site that everybody, it seems like, uses. Yeah, yeah. Last week's loss was about ad tech.

So arguing that Google improperly gained a monopoly in ad tech. The Competition Bureau of Canada has its own similar case against Google's ad tech in the works. But then, Matt, there's another case involving Google search. They lost that case last year. Um, but on Monday they just kicked off the remedies phase, which is where they decide what the penalties are going to be. And, uh, the government lawyer's position is that among other things, Google needs to sell off the Chrome browser.

Chrome's obviously the Chrome browser. Chrome is obviously a hugely important browser and one of the reasons Google search is so effective and dominant. Reuters points out that OpenAI has already expressed an interest in buying Chrome and that would shift the power quite a bit, especially at a time when generative AI is starting to be used in search. So a lot going on there and a lot at stake. I mean, it's interesting to watch these big companies go under the heat lamp, but it matters in part because so many of us use these services. Right? This is how we get on this internet. This is how we exchange information.

So what could the outcome of these cases mean? Not just for the internet, but for us. Yeah, I mean you can certainly argue and people do that antitrust crackdowns open things up for a more competitive and hence more innovative model rather than a few giant players being able to dictate the market. Tim Wu, our antitrust law expert, thinks it's potentially the end of the ad-supported model, free ad-supported model, we find on social media and elsewhere. The advertising model for social media and other services has the advantage of feeling free.

It has the disadvantage of creating what I think is very negative incentives to basically keep you addicted to the service. So you spend more time on the site looking at ads and also sort of emotionally engaged, whether angry or fearful or whatever. But I think we're starting to see the writing the wall for advertising models. So all those core issues that we talk about when we talk about the free ad supported model of,

you know, keeping you on these platforms longer than you normally would, that opens up the possibility of subscription models, which of course raises the question of access and equity. And, you know, as Tim pointed out to me in another part of the conversation, the backdrop to all of this is the question of access and equity. And as Tim pointed out to me in another part of the conversation, the backdrop to all of this is the AI revolution. And if we're about to move into a world

where AI is a transformational technology, what kind of tech landscape do we want? Do we want it controlled by a small number of large players or do we want it to be more opened up? That's a big- That's so interesting, because the whole idea was the product is free because you were the product.

Exactly. In some ways. Maybe because the whole idea was the product is free because you were the product. Exactly. In some ways. Maybe now the product won't be free. Yeah, well that's certainly on the table here. Do you see the chain being kind of pulled back in a little bit? We talked about these tech companies donating huge amounts of money to Donald Trump.

It now seems like there's a bipartisan support for reining in some of these companies. So what's changed here? Yeah, maybe the actual only bipartisan issue in the United States. This is what we can agree on. Yeah. Because some of these things, you know, these

things roll out over a long period of time. Some of them go back to the first Trump administration that were picked up with the, with the Biden administration. So it's been underway for a while. Um, but we're going to see this continue on for a little while in multiple jurisdictions. I mentioned the Competition Bureau of Canada. The EU is continuing its investigations under

the Digital Markets Act. And in the US, they're not done yet. There are cases coming up against Apple and Amazon that will be rolling out over the next year or so. So I think it's coming down to this recognition of just how powerful these titans are. And it doesn't show any signs of going away, Matt. I'd said at the beginning of the program that bigger may not be better for Metta. That seems to be the case. recognition of just how powerful these Titans are. And it doesn't show any signs of going away, Matt. I'd said at the beginning of the program that bigger may not be better for Metta, that seems to be the case. Yeah. I mean, and it's a certainly a question, and especially, I think when it comes

to something like AI, like at this point, you need to have a lot of money to launch these AI products and services. Right? So it's this balancing act of potentially the smaller players open up a lot of flexibility and a lot of innovation but at the same time who's actually paying for it, who has the deep enough pockets. This is so interesting. Nora, thank you very much. My pleasure, Matt.

Nora Young is the Senior Technology Reporter with the CBC's Visual Investigations Unit and she was here with us in our Toronto studio. For more CBC podcasts, go to cbc.ca slash podcasts.