Of the many complaints about Facebook, one comes through consistently: It’s just too big. Which is why some critics and regulators want to make it smaller by forcing Mark Zuckerberg to unwind major acquisitions, like Instagram.

Zuckerberg’s response: Let’s get bigger by buying more stuff.

After slowing down briefly in 2018, the year the Cambridge Analytica scandal erupted, Facebook has been steadily making large acquisitions — at least 21 in the last three years, per data service Pitchbook.

Many of the deals have been announced since December 2020, when the US government first filed an antitrust lawsuit against the company, accusing it of maintaining an illegal monopoly in social networking by buying or crushing competitors. The original suit and a revised complaint are aimed at forcing Facebook to divest itself of both Instagram and WhatsApp.

In the past couple years, Facebook’s appetite for deals has run the gamut from Giphy, which lets you place funny GIFs in your social media posts, to Kustomer, a business software company for Facebook’s corporate clients. Most of them, though, have been concentrated in one area: gaming and virtual reality. Which makes sense, since Zuckerberg has formally announced that gaming and virtual reality, bundled up in the expansive and hard-to-define rubric of “the metaverse,” are the future of Facebook.

Hence the company’s name change to Meta. But what’s more important is a promise that Facebook will move thousands of its employees into the effort, and plans to lose $10 billion on it this year alone, and much more “for the next several years.”

The day after Facebook announced the name change, the company illustrated how it will spend some of that money: a deal to buy Within, the company co-founded by VR pioneer Chris Milk, best known for its Supernatural workout app. People familiar with the transaction say Facebook paid more than $500 million for the company.

Other Metaverse-y deals announced this year include Unit 2 Games, which makes a “collaborative game creation platform” called Crayta; Bigbox VR, which makes a popular game for Facebook’s Oculus VR goggles; and Downpour Interactive, another VR game-maker.

already raising eyebrows before Facebook formally announced that they represented the future of the company. So what should we think of them now?

That is: If you think 2021 Facebook needs to be broken up, in part to undo deals from the past like Instagram ($1 billion, 2012) and WhatsApp ($19 billion, 2014), then shouldn’t you also be worried about deals Zuckerberg is doing now to build the 2031 version of his company?

A Facebook rep was happy to explain the difference to me: Unlike social networking a decade ago, Facebook isn’t the leader in virtual reality/augmented reality/pick a name for it — lots of big, well-capitalized companies are spending a lot of time and money on it. And, as he has taken pains to point out, Zuckerberg imagines a future where Facebook simply happens to be one of several companies in the metaverse.

Here’s the on-the-record statement the company gave Recode explaining the thesis:

“Investing in and building products that consumers want is the key to success. We cannot build the metaverse alone — collaboration with developers, creators, and experts will be critical. As we invest in the metaverse, we know that we face fierce competition from companies like Microsoft, Google, Apple, Snap, Sony, Roblox, Epic, and many others at every step of this journey.”

Translation: In the near term, Facebook is happy that Snap keeps trying to sell sunglasses that take videos and communicate with your phone because those are theoretical competitors to Facebook’s sunglasses that take videos and communicate with your phone. And Facebook will also be happy next year, when Apple is reportedly going to unveil its virtual reality headset, because it will compete with Facebook’s Oculus headsets.

But it’s also difficult to imagine that Facebook hopes Apple, Snap, and everyone else will be strong competitors forever. One of the main reasons Zuckerberg is interested in the metaverse, after all, is that he imagines it can give him a way to connect directly with his customers without having to depend on Apple and Google’s phone duopoly.

Facebook’s acquisition spree also highlights the difficulty antitrust regulators have in grappling with a fast-moving and unpredictable industry. Even the most aggressive antitrust measures we’ve seen in the last few years are designed to go back in time and fix supposed errors.

Or they’re focused on the now, like a proposed law that would prevent big platforms like Facebook from making big deals in industries they currently dominate.

So how do you look into the future and guess that Facebook — not Google or Epic Games or Roblox or a startup you’ve never heard of — will end up dominating the metaverse? Especially when the metaverse doesn’t exist, may never end up existing, or could end up existing in some form very different than Zuckerberg, science fiction writers, and tech execs and investors imagine it might today?

I’ve asked the Federal Trade Commission, the agency currently suing Facebook over its Instagram and WhatsApp deals, what they think of Facebook’s metaverse ambitions and purchases, but I don’t expect to hear back — in part because the agency doesn’t want to talk about Facebook while it’s in a long battle with Facebook, but also because it probably doesn’t know what it thinks.

Here it’s worth pointing out that the government doesn’t necessarily have to win a lawsuit or pass a law to slow or stop Facebook’s ambitions. Some tech investors I’ve talked to say they believe Facebook is — temporarily, at least — out of the market for acquisitions related to social networking, simply because there’s too much scrutiny and hassle.

“It just feels like it’s going to be very hard for Facebook in particular to acquire anything in the social space,” says a venture investor who has sold companies to Facebook in the past.

And that may apply not just to big-ticket acquisitions, but even tiny “acqhires” — deals for underwhelming companies made just to bring their engineers and other staff onto the Facebook payroll.

Washington has already signaled that it wants to pay more attention to small deals: In September, the FTC released an analysis of 616 transactions made by Facebook, Google, and other big tech companies over the last decade that weren’t big enough to trigger regulatory oversight.

But the report’s existence makes it clear regulators think they should be scrutinizing more deals, not less. FTC commissioner Rebecca Slaughter made it even clearer: “I think of serial acquisitions as a Pac-Man strategy,” she said when the report was released. “Each individual merger viewed independently may not seem to have significant impact, but the collective impact of hundreds of smaller acquisitions can lead to a monopolistic behavior.”

You can debate whether Facebook has a monopoly on social networking today — the company is delighted to point out the nearly overnight success of TikTok to argue that it doesn’t. But there’s zero question about its enormous wealth and power. The real question: Will we let it use those resources to extend its power into the future?

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