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Silicon Valley's regulatory discussions dominated this year's SXSW festival in Austin, with Senator Elizabeth Warren's (D-MA) commitment to divide Amazon, Apple, Google and Facebook, becoming a topic of conversation in almost every panel targeted here.
Kevin Systrom and Mike Krieger, co-founders of Instagram, were no exception to the rule. The entrepreneurs sold their business to Facebook, worked there for years, then left abruptly last September, while their autonomy and the future direction of the social photo-sharing network raised concerns. In addition, Facebook CEO Mark Zuckerberg announced last week a new change, focused on privacy, which would see its disparate messaging products combined to form a unified service.
Neither Systrom nor Krieger was keen to criticize their former employer; Systrom claimed that loss of independence was a natural by-product of Instagram's growth. But both answered the questions of TechCrunch Editor-in-chief Josh Constine asked whether technology companies should be divested and, in particular, whether the sale to Facebook had ultimately harmed competition and users. The short answer: no, and in fact, the acquisition only helped users by letting Instagram expand as fast as it did, says Systrom.
"Here's the problem: if Instagram had not been sold to Facebook and was gone, it's an example of a merger or acquisition that reduces competition," said Systrom, adding that the competition internal between Facebook, Instagram and WhatsApp had led to better ideas. "Which consumer has been damaged because Instagram has reached the size that it has reached? I think [Instagram’s size] is a strong argument that the acquisition has helped users. "
Systrom was quick to point out that he was not an expert in antitrust. And to be honest, it's not hard to argue that the staggering growth of Instagram under Facebook's ownership could have prevented competing photo-sharing apps from clinging. But Systrom says he is more skeptical about calls for the dissolution of tech companies. These are not mere hollow promises to capitalize on the burgeoning anti-technology movement he sees developing in Washington.
"Being big in itself is not a crime," he said. "I fear that a proposal to dismantle all technologies will only play on the current feeling of anti-technology rather than do what politicians should do, that is, solve the real problems with real solutions.
Krieger also thinks that the discussion on the regulation of technology platforms and the cancellation of acquisitions is lacking nuance. "Breaking the technology and having these conversations, I think they will get better and lead to better policy if we are really specific to the problems we are trying to solve," said Krieger. He added that policy makers needed to clarify the issues and what we might want to achieve through regulation. "Amazon that sells white label products is very different from Facebook that has Instagram."
We do not know what Systrom and Krieger plan to do next. At the end of the discussion, Constine urged both men to give the audience a mere hint, without one of them hooking. (They are both seemingly exploring new potential ideas.) But it's clear that Instagram's founders may be less dissatisfied with the path their company took than their sudden departure would have suggested. . "I think that Instagram going on stage is an amazing thing for the world and for users," concluded Systrom.
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