US Judge Rules Meta Is Not a Monopoly but Says Facebook and Instagram Have Lost Their Edge

Meta Platforms has won a major legal battle against the United States Federal Trade Commission (FTC) after a federal judge ruled that the company does not need to unwind its acquisitions of Instagram and WhatsApp. But the ruling came with a warning: Meta is losing the dominance that once set it apart.

In a decision delivered on Tuesday, Judge James Boasberg held that Meta cannot be considered a monopoly because its share of the social-media market, measured by user attention and time spent, has been declining. He noted that although Meta’s platforms remain large, the broader digital ecosystem has expanded significantly, with strong alternatives competing for user engagement.

Boasberg said companies like TikTok and YouTube now offer nearly identical features to Facebook and Instagram, blurring the differences that once strengthened Meta’s position. The trend, he added, has become even more pronounced as artificial intelligence reshapes how platforms recommend and deliver content.

“Facebook, Instagram, TikTok, and YouTube have evolved to have nearly identical main features,” the judge wrote, arguing that Meta’s once-distinct social experience is now harder to distinguish from rivals. The company’s most widely used tools, including Stories and Reels, were described as “indistinguishable” from features on competing apps.

How Meta Evolved

For years, Meta’s competitive advantage rested on the “social graph,” the unique web of personal connections that made Facebook and Instagram the primary places users went to keep up with friends and family. Boasberg said that advantage has weakened as users’ relationships have changed over time but their platforms have not.

“Longtime users’ friend lists have become an often-outdated archive of people they once knew,” he wrote, adding that posts from real-life friends have “grown less interesting,” pushing the company toward algorithm-driven “unconnected” content.

According to the ruling, Americans now spend only 17% of their time on Facebook viewing posts from people they know. On Instagram, that figure drops to 7%. Most of the content users now see is short video from strangers, recommended by AI, a space where TikTok and YouTube remain dominant and highly competitive.

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The ruling notes that TikTok, which only became widely popular in 2018, has “overrun the market,” contributing to Meta’s shrinking share of user attention. Even AI companies such as OpenAI are developing their own content feeds, adding new competitive pressure.

Meta’s strategy of copying rival features, such as adding Snapchat-style Stories and TikTok-style Reels, may have helped it stay relevant, analysts noted, but the approach also reduced the distinctiveness of its products.

Despite these challenges, Meta remains one of the world’s most powerful tech companies. It is expected to generate nearly $200 billion in revenue this year, with a market value above $1.5 trillion, and continues to invest heavily in AI and large language models.

However, Boasberg’s ruling emphasizes that scale alone does not equal monopoly control, especially in a rapidly shifting market.

With its legal victory secured, Meta is now pushing further beyond traditional social media. The company is ramping up its AI ambitions, competing directly with players like OpenAI, Anthropic and Google in a field that is quickly becoming even more crowded.