Source: Wind

According to a report by Hong Kong Wind Information, news on November 25 states that $Meta Platforms (META.US)$ Meta will face a trial by the Federal Trade Commission in April 2025, and if the antitrust regulator wins, Meta may be forced to sell Instagram and WhatsApp.

FTC reviews Meta's acquisition activities.

Antitrust regulators, including the Federal Trade Commission (FTC), have been reviewing Meta's acquisition activities, believing that the acquisition of Instagram in 2012 and WhatsApp in 2014 may eliminate competition and consolidate its monopolistic position.

The FTC believes that by acquiring Instagram and WhatsApp, Meta eliminated potential competitors, limiting user choices in the personal social network field, thereby consolidating Meta's monopolistic position in this market and hindering innovation and competition in the industry.

Washington Judge James Boasberg dismissed Meta's argument for case dismissal, stating that although the FTC's market definition faces challenges from time and technological changes, the FTC provided stronger and more detailed evidence after re-filing, especially regarding Meta's alleged monopolistic behavior.

Meta may lose important entry points in the social field.

Instagram and WhatsApp are important social platform assets under Meta. Selling them will cause Meta to lose significant territory in the social space, which may impact its overall user scale, data resources, and advertising revenue. Additionally, it could also affect the global strategy that Meta is promoting, such as the metaverse, because Zuckerberg had planned to integrate the underlying communication of Facebook, Instagram, and WhatsApp to support the development of the metaverse.

For the industry's competitive landscape, if Meta sells Instagram and WhatsApp, it will create new competitive opportunities in the social network market. Other competitors are expected to gain more market share and development space, thereby reshaping the competitive landscape of the social network industry and promoting market diversification and innovative development.

Analysts have not turned bearish on Meta.

Currently, Wall Street analysts generally hold a bullish outlook on Meta's future growth, especially in terms of improvements in advertising efficiency, ai research and development, and investments in metaverse technology. At the same time, they also pointed out that Meta needs to find a balance between the regulatory environment and cost control for long-term investment.

Wells Fargo's Ken Gawrelski adjusted Meta's target price to $641. He mentioned the recovery of Meta's advertising market performance and progress in ai-driven tools but maintains a cautious attitude towards the impact of legal challenges in the short term.

Many analysts are optimistic about Meta's potential in the field of ai, believing that its ai technology optimizes user engagement, which in turn drives the growth of its advertising business. Moreover, the launch of new ai models like MovieGen opens up new revenue sources for Meta and has the potential to promote the development of more innovative services, consolidating its leadership position in digital innovation.

Editor/Rocky