Zuckerberg viewed Instagram as a threat that could hurt Facebook's business before buying it, internal emails show

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Zuckerberg viewed Instagram as a threat that could hurt Facebook's business before buying it, internal emails show
Facebook CEO Mark Zuckerberg testifies before a joint hearing of the Commerce and Judiciary Committees on Capitol Hill in Washington, Tuesday, April 10, 2018.AP Photo/Alex Brandon
  • Mark Zuckerberg viewed Instagram as a threat that could harm Facebook's business before buying it.
  • That's according to emails the technology CEO sent in 2012 to colleagues before the acquisition.
  • The internal emails became public on Wednesday amid a congressional antitrust hearing.
  • Facebook is facing growing antitrust scrutiny, with some critics calling for the company to be broken up into its constituent parts over allegations of anticompetitive behavior.
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Mark Zuckerberg privately told colleagues that Instagram "can hurt us meaningfully without becoming a huge business" shortly before Facebook acquired the photo-sharing app in 2012.

Newly public emails from 2012 detail how Facebook viewed the buzzy photo-sharing app as a competitor at the time of the acquisition — shedding new light on the $1 billion deal as Facebook faces mounting antitrust scrutiny over its pattern of acquiring competitors.

The emails were obtained by the House Judiciary Committee as part of its yearlong antitrust probe into Facebook and other tech giants and first referenced in a public hearing by Rep. Jerry Nadler on Wednesday. The Verge has since published longer excerpts from the documents.

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In an email to Facebook's chief financial officer at the time, Zuckerberg said Facebook wanted to buy Instagram to give itself more time to fend off competitors.

"One way of looking at this is that what we're really buying is time. Even if some new competitors springs up, buying Instagram, Path, Foursquare, etc now will give us a year or more to integrate their dynamics before anyone can get close to their scale again," he wrote. "Within that time, if we incorporate the social mechanics they were using, those new products won't get much traction since we'll already have their mechanics deployed at scale."

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Nadler pushed Zuckerberg on the exchange during the hearing on Wednesday. In response, Zuckerberg said Facebook viewed Instagram "as a competitor and a complement to our services," specifically competing with Facebook "in the space of mobile cameras and mobile photo sharing," but that it wasn't viewed as a competitor with regard to social networking.

In another email from 2012, Facebook's chief financial officer at the time, David Ebersman, asked if Facebook was trying to "neutralize a potential competitor" or "integrate their products with ours."

Zuckerberg answered affirmatively: "There are network effects around social products, and a finite number of different social mechanics to invent. Once someone wins at a specific mechanic, it's difficult for others to supplant them without doing something different."

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