Following the launch of the text-sharing app Threads last Thursday, Meta has seen a strong reaction from both competitors and regulators. Immediately following the launch, Twitter threatened legal action claiming that work carried out on the app by fired Twitter employees who were later employed by Meta constituted a violation of trade secrets. Meanwhile, regulators have wrestled with the antitrust implications of the launch weighing the benefits of increased competition for Twitter against the challenges of the increasing reach of Meta.
Beginning development in January 2023, Threads was first advertised on the Apple Store on July 3rd. The launch came days after Twitter had announced a controversial daily allowance for users after citing concerns with “data scraping and system manipulation”. Within the first two days of its launch Threads gained over 80 million users surpassing a record set by Chat GPT last year with the most downloads immediately following release.
The launch of the app raises questions for regulators concerned with market monopolisation. The introduction of Threads to Meta’s portfolio of social media platforms adds to a complex picture. Although it increases the conglomerate’s market share, pundits have highlighted that there could be a benefit to consumers as a viable competitor to Twitter.
Meta also faces challenges in Europe after the European Court of Justice ruled in favour of Germany’s anti-competition regulator Bundeskartellamt. The regulator had challenged Meta’s use of user data collected from different platforms. A fundamental component of the conglomerate’s business model is using combined data collected on users from its subsidiaries to sell targeted advertising.
The ECJ confirmed BkartA’s interpretation that Meta must offer users the option to use their platforms without having their data collected in this way. The previous approach taken by Meta, providing the option of consenting to this data usage or not using the service at all, was considered to represent a false choice. The EU court ruled that users must be allowed to use the platform without consenting to this form of data collection.
Alongside the upcoming introduction of the Digital Markets Act, this ruling has had an immediate impact on Meta’s business operations in the EU. As Threads nears the end of its first week post-launch, regulators will continue to consider the wider implications of Meta adding a record-breaking app to an already ubiquitous portfolio of social media platforms.
Article by Nick Scott