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Schultz acknowledges there was tension between his central growth team and Systrom in the mid-2010s, which we heard about from Systrom’s perspective a few weeks ago. While Systrom described a situation where Meta pulled back growth staff for Instagram, Schultz says Systrom was uninterested in the tweaks his team suggested to grow the app. It was only after the growth team pulled back from Instagram that Systrom realized their value and wanted them back, Schultz recalls.

The FTC is expected to wrap up its case this week, meaning Meta will then get the chance to call its own witnesses for its case-in-chief. Meta CMO Alex Schultz is back on the stand testifying about the staffing and expertise the company gave Instagram after its 2012 acquisition. He says that for the first three to four years post-deal, Meta gave Instagram co-founder Kevin Systrom pretty much “everything he wanted.”

Schultz says when he took on the task of leading the company’s brand reputation, it was like “catching a falling knife.” But things have since gotten better. He says relative brand sentiment for Meta falls somewhere in the middle of other companies it measures against, putting it pretty close to the bank that in 2020 settled a criminal investigation with the US government over alleged fraud.

When Instagram ran a test showing one group more friends and family-focused content, it reported in 2016 that it found a 7 percent increase in time spent on the platform and a 7 percentage point increase in user retention. Turning to cross-examination, Meta’s attorney points out a lot has changed in the market since that period.

Meta CMO Alex Schultz is back on the stand after Mosseri finished testifying. In a 2014 email shortly after Facebook announced its WhatsApp acquisition, Schultz responded to an executive concerned that the Messenger team was “demotivated by the announcement.” Schultz said he was “more motivated than ever to still be working on messenger.” The first explanation he listed: “Have to keep things honest so the deal doesn’t fall through and prove there is competition.”

The FTC revisits the Kardashain-popularized meme pushing back on Instagram’s design overhaul that it later walked back. It’s walking through a 2022 interview with The Verge where Mosseri explained the decision. He testifies that people always complain about change, and that connecting with friends remains an important reason users come to the app, but Instagram has to to adapt the form in which they facilitate that in order to survive.

“I never met a creator who didn’t think they deserved more reach than they were getting,” Mosseri says. But the reality is, he adds, there’s two times as many creators this year than last, so the field is getting more and more saturated. “Even though Instagram might benefit, there are winners and losers within the creator ecosystem.”

Mosseri takes the jab at TikTok after the FTC asks about the reliability of TikTok’s data evaluating how much its features are used. The FTC may be underscoring a TikTok executive’s earlier testimony that it’s “friends” feed only makes up a small percentage of videos viewed on the app. That goes toward the FTC’s argument that users don’t primarily go to TikTok to connect with friends, as they more often do with Instagram.

That’s how Mosseri describes Facebook’s decision to buy Instagram in 2012. He says that both companies “benefited greatly” — Instagram, from Facebook’s resources and experience, and Facebook, from the founders’ talent for building compelling products.

Mosseri found himself in the middle of the tension between the two companies, having moved to Instagram from Facebook. He understood some of the concerns the Instagram founders had about things like discontinuing some links from Facebook to Instagram, and similarly disagreed with certain changes from Facebook, but “also thought they were being made more of than they needed to be.”

Mosseri estimates this is the most Instagram has spent in a given year on creator incentives. Instagram sees creators as a good source of content after many rank-and-file users began posting fewer of their own updates.

That’s how Mosseri describes the state of things in late 2021, where a chart in a board presentation shows relatively flat growth in time spent on Instagram. If you were to look at Instagram’s growth here in isolation, he says, it would look like Instagram had some positive, modest growth. But comparing it to TikTok’s explosive rise tells a different story.

In a March 2020 update to Instagram staff, Mosseri gave a bleak overview of the challenges the company was facing. “The engagement trends, particularly in the US, have been concerning. Time spent has dropped, stories consumption and production have plateaued, Feed’s decline has continued, and time in Explore has been sliding since the summer of 2018,” he wrote, blaming the slide, in part on some of the company’s own mistakes “and competition from TikTok and Snapchat.”

The first time around, Instagram tried to build its short-form video concept on top of Stories, which he says was “not a sound foundation” for the product. “I think we could have and should have been more aggressive,” he says about building Reels and competing with TikTok.