The Snapchat Saga: A Billion-Dollar Missed Opportunity
Fast-forward more than a decade after Snapchat’s audacious refusal to accept Meta’s (then Facebook) acquisition offer, and the reverberation of that rejection seems to still be felt. Zuckerberg’s remarks during the testimonial in Meta’s antitrust trial shed light on the fact that, in his mind, there appears to be considerable lost opportunity value with respect to the decision.
Zuckerberg’s Comments: A Peek Through the Looking Glass
Zuckerberg’s comments during the trial gave a glimpse into the attempts that led Meta to buy other companies and highlighted the 2013 effort to purchase Snapchat that led nowhere. As part of the evidence, the court was shown an email from Zuckerberg where he expressed anxiousness about the pending deal, claiming that Meta offered $6 billion to purchase the photo messaging app, a large offer merely two years after the launch of Snapchat.
The implications of Snapchat’s alleged acquisition that Meta attempted to do are utilized by the U.S. government in conjunction with Instagram’s and WhatsApp’s acquisitions. This, alongside every other acquisition, assists their contention that Meta’s strategy was to buy or bury competitors in the social media industry. After all, the Federal Trade Commission believes these purchases sought to eliminate innovation in the social media landscape dominated by Meta.
What Federal Acquisition Zealot Thompson bases his analysis on the fact that Meta had a forward-thinking strategy ever since they bought Facebook in 2012, acquiring all other platforms that could rival social media and either developing or stifling innovation to the point that there was none after they bought Instagram and WhatsApp, acquiring every other self-serving competitor.
We all remember the congressional hearing where Zuckerberg, along with other famous tech founders, stood to testify over issues related to his platforms losing user privacy and data handling, and he proposed the justification that Snapchat simply wasn’t developing fast enough, or at all.
He did go into great detail on how he thought if Meta purchased Snapchat, accelerated growth of their platforms would be ensured, thus cementing his viewpoint of the potential being ignored for growth.
Zuckerberg just had to go and state his reasons for wanting to purchase Snapchat. It’s a good thing Meta managed to avoid them developing a Snapchat in-house, considering how big on speculation they are using their resources.
Snap shot back with extreme vigor, stating that Snap derives innovation as a core component of its success. Snap’s spokesperson Monique Bellamy claimed that “anticompetitive behavior can often slow and thwart the growth of smaller companies and entrepreneurs tend to avoid it because of the creeping Meta’s sluggish dinosaur.”
Monique Bellamy goes on to say, “Public reports of Meta’s attempt to buy Snap and then copy its features were an attempt to compete.” Snap stands on the fact that “their business thrives by continuing to innovate and build products and services that are useful and enjoyable.”
Meta’s comment: “The Claims and Reality of Competition”
Meta has countered the claim by stating that it operates in an extremely competitive environment with heavy competition from TikTok and YouTube. A Meta representative defended by saying, “Just like Snap has accepted multiple times, they are in competition with me and a thousand other businesses, which turns off full innovation and advancement for anything that is worth grapes on the system for the users.”
The Implications: A Major Trial Guerra
The antitrust battle between Meta and the FTC is of the utmost importance and concern when looking at the future of the social media landscape.
This may result in Meta being compelled to sell off Instagram and WhatsApp, which would significantly alter industry competition. The trial, which commenced on Monday, can extend up to 8 weeks.
