If the government gets its way, it could force a breakup of the social-media giant. One analyst asks: ‘Without Instagram and WhatsApp, what really is Meta?’

Mark Zuckerberg was called to testify on the first day of Meta’s antitrust trial.

The U.S. government’s antitrust case against Meta Platforms Inc. began Monday, with regulators taking aim at the company’s past acquisitions of Instagram and WhatsApp.

A ruling in favor of the government could upend the social-media industry’s largest player by forcing the divestitures of services core to Meta’s identity.

The case, which is being heard in federal court in Washington, D.C., is the first antitrust lawsuit to be heard under the second Trump administration. The Federal Trade Commission filed the case against Meta in 2021 and argues that the company is a monopolist that bought Instagram and WhatsApp to kill off its competition as it struggled in the then-nascent mobile arena.

The company, then called Facebook, “resorted to an illegal buy-or-bury scheme to maintain its dominance,” the FTC contended in its initial complaint. “It unlawfully acquired innovative competitors with popular mobile features that succeeded where Facebook’s own offerings fell flat or fell apart.”

The FTC alleges that Meta engaged in those tactics as part of its attempt to maintain its “monopoly power in the market for personal social-networking services.”

Meta, for its part, said in its opening argument Monday that it is not a monopoly, and that both direct and indirect evidence given throughout the trial will show that it is not a monopoly.

“They’ve gerrymandered a fictitious market in which Facebook and Instagram compete only with Snapchat and an app called MeWe,” Meta Chief Legal Officer Jennifer Newstead wrote in a company blog post on Sunday. “In reality, more time is spent on TikTok and YouTube than on either Facebook or Instagram — if you only add TikTok and YouTube into the FTC’s social-media market definition, Meta has <30% market share.”

In slides presented during its opening argument, Meta argued that it does not behave like a monopolist. The company noted that it does not charge a price for its services and it does not degrade the level of its products to fall below its competitors. Meta also said it spends more on research and development, as a percentage of revenue, than its rivals.

While most analysts on Wall Street don’t appear to be too nervous that Meta could lose this case, Meta’s shares fell 2.22% on Monday as the first day of the case unfolded.

Chief Executive Mark Zuckerberg was called as the FTC’s first witness, and his first hour or so of testimony focused on how Meta had missed the way that social media was evolving. Zuckerberg said the company’s news feeds had been prioritizing content shared by users’ friends. The company missed that users wanted content from other sources, according to Reuters.

Earlier, Meta’s attorney also showed the court slides on how the usage of Meta’s products — Facebook, Instagram, WhatsApp and Threads — increased during the weekend in January that the U.S. ban of TikTok took effect (the deadline has since been extended).

The FTC is seeking to prove that Meta bought Instagram and WhatsApp in 2012 and 2014, respectively, because they were threats to Facebook. Meta will argue, however, that it has spent billions on growing both of those companies. Instagram has grown from “a small app with an uncertain future” into one with more than 2 billion monthly active users. WhatsApp has changed from a paid subscription service to a free service with both voice and video calling.

Forrester Research conducted a recent poll that found 54% of its 500 adult respondents believed that Meta has a monopoly in the social-networking market, with 19% disagreeing and 27% remaining neutral on the question.

If the court feels the same way as over half the respondents in Forrester’s poll, Meta could eventually be in serious trouble, and the judge could rule it has to divest its two biggest acquisitions made over a decade ago. Forrester analyst Mike Proulx said that if it has to do that, Meta would no longer be the “center of gravity” in social media. He added that while Meta has been trying to make Facebook cool again, its “social-media ‘insurance’ is (and has been for a while) Instagram.”

“Without Instagram and WhatsApp, what really is Meta? Could Facebook seriously compete with a stand-alone Instagram? Can Threads monetize at scale?“ Proulx said in an email.

The case that was filed by the Federal Trade Commission in 2021 was an amended version of a lawsuit it had first filed in 2020, alleging Meta purchased Instagram and WhatsApp to gain an unfair advantage over smaller rivals. The FTC amended its case in 2021 after the judge initially questioned whether the social network had true monopoly power.