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Leaked internal emails from the ongoing Meta antitrust trial reveal Meta CEO Mark Zuckerberg’s apprehension regarding the potential for Instagram’s growth to undermine Facebook’s dominance. Zuckerberg reportedly expressed concern in a confidential message to Meta executives that the acquisition of Instagram could “cannibalize” Facebook, potentially leading to a “network collapse” of what he considered the more profitable and culturally significant platform.
Instagram’s Growth Concerns Facebook’s Future
To mitigate this perceived risk of cannibalization, Zuckerberg explored several strategies. These included enhancing integration between Meta’s applications to foster a unified network, implicitly acknowledging Instagram’s role in Facebook’s diminishing cultural relevance. He also reportedly considered whether divesting Instagram as an independent entity might be a more advantageous path forward for Facebook.
The Federal Trade Commission (FTC) is currently prosecuting Meta, aiming to establish that the tech giant operates an illegal social networking monopoly. The FTC contends that Meta’s acquisitions of rival platforms like Instagram and WhatsApp were strategic moves to solidify its market dominance. As part of their case, prosecutors are presenting internal communications, including emails, suggesting Zuckerberg was acutely aware of the competitive threat posed by Instagram to Facebook, even after Instagram became part of the Meta portfolio.
In a May 2018 email, Zuckerberg articulated his concerns to key Facebook leadership. Recipients included Meta Chief Product Officer Chris Cox, former COO Sheryl Sandberg, former CTO Mike Schroepfer, former Chief Growth Officer (now COO) Javier Olivan, and former CFO David Wehner. Zuckerberg indicated his unease with the company’s overarching approach to managing its suite of applications.
Specifically, Zuckerberg voiced worries that the expansion of Instagram could negatively impact Facebook’s core business. He cited internal data indicating a “significant decline” in Facebook user engagement following users joining Instagram.
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“We are beginning to observe more data suggesting that this erosion of Facebook usage intensifies as a larger proportion of the population adopts Instagram,” Zuckerberg stated in a section of the email labeled “cannibalization and network collapse.”
Zuckerberg seemingly concluded that the more Meta propelled Instagram’s expansion, the greater the potential jeopardy to Facebook’s established user base and engagement.
“This brings up the concern that our projections for the future may be inaccurate,” Zuckerberg continued. “We currently anticipate both Facebook and Instagram achieving continued growth. However, it appears increasingly probable that aggressively promoting Instagram to reach a scale comparable to Facebook would generate substantial adverse consequences for Facebook that are not currently factored into our models,” he wrote. “In other words, the Facebook network can likely withstand reduced engagement among a subset of its users, but if engagement across its entire user population diminishes, it could yield considerably more negative outcomes than we presently foresee,” Zuckerberg elaborated.
He further noted that Instagram’s growth was largely fueled by distribution channels within the Facebook application and leveraged Facebook’s existing social graph.
“This suggests that while we aspire to cultivate two thriving platforms, there is a genuine risk we might inadvertently trigger a network collapse of the more engaging and more profitable product, replacing it with a less engaging and less profitable alternative,” Zuckerberg cautioned.
Consequently, Zuckerberg stated that Facebook was curtailing promotional efforts for Instagram. He advocated for the introduction of new integrations designed to re-establish a more favorable balance for Facebook. He advocated for building bridges between the two platforms to ensure the applications “increasingly operate as a unified network across various dimensions.”
As an illustration, Zuckerberg emphasized the need to facilitate seamless engagement across both platforms for video creators with substantial audiences. Furthermore, he proposed merging the voice and video calling infrastructure across WhatsApp, Messenger, and Instagram into a singular unified network. (Meta subsequently implemented cross-platform messaging in 2020, before reversing this integration years later.)
Evaluating a Family of Apps Strategy Against a Potential Spin-Off
Zuckerberg also explicitly mentioned the challenges associated with developing new products and services within Instagram and WhatsApp, citing issues related to “their founder leadership.”
He expressed apprehension that openly discussing concerns regarding Instagram could negatively affect team morale and hinder the company’s ability to retain Instagram co-founders Kevin Systrom and Mike Krieger.
Furthermore, he urged the company to reassess its product branding strategy, advocating for Facebook’s brand to maintain a central and prominent position.
“Upon launching these applications, they should display ‘Instagram by Facebook’ and ‘WhatsApp by Facebook,’” Zuckerberg suggested in his email. “We might even need to integrate Facebook branding into the visual interface of these apps, where the app names and logos are currently located, to firmly establish this connection in users’ minds.”
Zuckerberg pressed for a revision of Meta’s branding strategy to ensure Facebook remained highly visible and central to user perception.
In a contrasting move, Facebook rebranded itself as Meta in 2021. The Meta logo is now displayed across all of the company’s applications.
Should the FTC prevail in its legal challenge, Meta might be mandated to divest Instagram and WhatsApp into separate, independent businesses. Paradoxically, Zuckerberg himself had proposed this divestiture in his 2018 email as a potential alternative strategy—possibly the “only structure” capable of achieving the company’s objectives. According to Zuckerberg, spinning off Instagram could safeguard Facebook’s growth trajectory, sharpen the focus of Meta’s operational teams, and facilitate the retention of Systrom. (Instagram’s founders ultimately departed in September 2018.)
Ultimately, Meta decided against divesting its acquired platforms. However, Zuckerberg had cautioned other executives in the email about a “significant possibility” that Meta could be compelled to spin off Instagram and WhatsApp within the ensuing 5 to 10 years, potentially rendering the company’s efforts to build a family of apps “something we don’t get to keep.”
If the FTC lawsuit is successful, Zuckerberg’s prediction will prove accurate.
Meta has minimized the significance of these emails in a public statement provided to TechCrunch.
“Out-of-context and dated documents concerning acquisitions that underwent FTC review over a decade ago will not obscure the realities of the competitive landscape we encounter or overcome the FTC’s unsubstantiated legal claims,” a Meta spokesperson stated.