Instagram founders say selling to Facebook didn’t reduce competition among social networks

The talk about regulation of Silicon Valley has dominated this year's SXSW festival in Austin, with Senator Elizabeth Warren's (D-MA) commitment to breaking Amazon, Apple, Google and Facebook becoming A topic of conversation in almost every profile, panel focused on technology here.

A meeting with Instagram co-founders Kevin Systrom and Mike Krieger this afternoon was no exception. The entrepreneurs sold their company to Facebook, worked there for years, and then abruptly withdrew last September, amid concerns about their autonomy and the future direction of the social network to share photos. In addition, Facebook general manager Mark Zuckerberg announced last week a new change in privacy for the company that would see its different messaging products combined to form a unified service.

Neither Systrom nor Krieger were eager to openly criticize their former employer; The closest we got was to Systrom, who said the loss of autonomy was a natural byproduct of Instagram's growth. But both responded to questions from general editor TechCrunch Josh Constine about whether technology companies should be split and, in particular, if selling to Facebook harmed competition and users. The short answer: no, and in fact, the acquisition only helped users by allowing Instagram to expand as fast as it did, says Systrom.

"Here's the thing: if Instagram had not sold to Facebook and left, then that's an example of a merger or acquisition that occurs and reduces competition," Systrom said, adding that internal competition between Facebook, Instagram and WhatsApp led to better ideas. "What consumer was damaged because Instagram grew to the size that it did? I think [Instagram’s size] is a strong argument that the acquisition helped the users. "

Systrom was quick to point out that he is not an expert in the defense of competition, and, to be fair, it's not hard to argue that the Vertiginous growth of Instagram under the ownership of Facebook could have prevented competition from competing photo-sharing applications, but Systrom says that, in general, he is skeptical that calls to break up technology companies are real solutions and not just empty promises to capitalize the growing anti-tech movement that is brewing in Washington.

"Being great in itself is not a crime," he said. "My fear is that a proposal to break with all the technology is playing with the current feeling of the anti-technicians instead of doing what politicians should do, which is to address real problems with real solutions.

Krieger also thinks that there is a lack of nuances in the discussion about the regulation of technological platforms and the retreat of acquisitions. "Breaking technology and having those conversations, I think they will go better and lead to a better policy if we are really specific about the problems we are trying to solve," Krieger said. He added that policymakers should clarify what the problems are and what we may want to achieve through regulation. "Amazon that sells white label products is very different from Facebook that Instagram has."

It is not clear what Systrom and Krieger plans to do next. Constine instigated both men at the end of the panel discussion to give the audience even a small clue, and neither of them took the bait. (Both apparently are now exploring some possible new ideas). But what is clear is that the founders of Instagram may be less dissatisfied with the path their company took than their sudden departures would make us think. "I think that for Instagram to get to the stage that did it is something incredible for the world and something incredible for users," Systrom concluded.

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