Phhhoto sues Meta alleging that Instagram plagiarised and killed its app
A former Instagram competitor has filed a lawsuit against Meta, formerly known as Facebook, alleging that the corporation broke antitrust rules by duplicating a competitor’s product and ruining its business.
Phhhoto, a video-making software that launched in 2014, allows users to make and share short GIF-like films. If it seems familiar, it’s because Boomerang, an Instagram app, popularised the same feature. Instagram’s basic app experience now includes that capability.
The recently filed complaint claims that Facebook broke antitrust rules by blocking the app’s access to its social network, delaying a prospective partnership, and finally launching its own version of Phhhoto’s primary feature: the seconds-long looping video.
Gary Reback of Menlo Park will represent Phhhoto in the lawsuit. Reback is best known for his role in laying the groundwork for the federal government’s successful antitrust case against Microsoft, which didn’t result in the tech giant being split up but did force it to open up some aspects of its computing business, with ramifications that are still felt in the industry today.
Phhhoto’s experience, according to Reback, demonstrates why it’s bad for the market when a large tech firm takes out its competitors and runs its operations.
“The evidence shows that Facebook would have joined with Phhhoto and built a brilliant new social network to compete with Instagram,” Reback added. He emphasised Facebook’s senior leadership’s extremely hands-on attitude to the young competition.
Kevin Systrom, the co-founder of Instagram and the company’s CEO at the time, also downloaded the app and investigated its capabilities. According to the complaint, Facebook courted Phhhoto and offered cooperation options that were later withdrawn:
“… Hurren, then Facebook’s Strategic Partnerships Manager, reached out to
Phhhoto, asserting that Phhhoto was ‘really awesome.’ Hurren first offered to incorporate
Phhhoto’s technology into the Facebook Messenger service. When Phhhoto declined, Hurren offered to incorporate Phhhoto’s content into Facebook’s users’ Newsfeeds. Phhhoto invested heavily in this project, but ultimately Hurren did not move forward, citing internal “legal conversations” that “hung” the project up.”
Following the failure of the connection, the complaint claims that Facebook took a variety of steps to put the company out of business, including deleting pre-populated Instagram hashtags that identify where content on the platform originated. Instagram also removed Phhhoto from its social graph, making it impossible for users of the alleged rival to interact with their Instagram friends on the app.
The death of Phhhoto had a few dramatic moments: Instagram released Boomerang on October 22, 2015, the same day the company was slated to release an Android version of its app. Boomerang product manager John Barnett is listed as an “active Phhhoto user” in the lawsuit. Boomerang was “suspiciously similar” to Phhhoto at the time of its inception, according to TechCrunch.
According to the lawsuit, Boomerang was the climax of Facebook’s anti-competitive efforts, which included a copycat app that replicated Phhhoto’s inventions “feature-by-feature.”
According to the lawsuit, Phhhoto was unaware of the nature of Facebook’s anti-competitive actions at the time, only learning about it after the UK Parliament revealed a trove of the company’s internal records in late 2018.
While all of this was going on, Phhhoto wasn’t scared to speak out about Facebook’s actions. Phhhoto co-founder Champ Bennett told TechCrunch in 2017 that “we witnessed Systrom and his product team discreetly using Phhhoto almost a year before Boomerang was published.”
Bennett claimed it “wasn’t surprising at all” to see Instagram build its own clone after the app was shut down.