Lauren Feiner

A chart in Rim’s report comparing Instagram and WhatsApp’s engagement before and after their acquisitions is misleading, an attorney for Meta suggests in his cross-examination. The chart includes figures based on US user numbers in one color and global numbers in another. It appears that the apps had higher engagement prior to being acquired. The Meta attorney points out that the chart doesn’t distinguish between domestic usage and global usage, where engagement was lower.

That’s how Morgan Stanley proposed pitching the app to Facebook in a deck when the bank was seeking to be WhatsApp’s advisor for a sale, according to Rim. “WhatsApp could determine the social network winner on mobile,” the bank wrote. “Google’s resources combined with WhatsApp’s user base and traction could create the predominant social network on Mobile (surpassing Facebook).”

Boasberg asks Rim why he thinks WhatsApp would have eventually generated revenue despite the founders’ initial resistance to an ad model. One of the app’s investors, Jim Goetz, had earlier testified that it was “laughable” to suggest he could convince the founders to adopt ads.

Rim says that, eventually, all startups need to monetize their product. “You cannot lose money forever,” he says, even as Meta CEO Mark Zuckerberg testified, WhatsApp’s founders resisted advertising and had limited ambitions. Rim says, “It’s common that founders change minds over time, especially if you are losing a lot of money, then you have to face reality.”

The FTC’s expert witness Jihoon Rim, who previously ran WhatsApp competitor Kakao, says both apps’ growth pre-acquisition were “exceptional.” On any given day, more than 60 percent of monthly users would be active, and both apps’ userbases grew very quickly. Rim says that WhatsApp’s lead investor had called it one of the highest-engagement apps they’d seen — higher, even, than Facebook.

It’s the fifth trial day in the antitrust case over its alleged social media monopoly. The big witness this week is Instagram co-founder Kevin Systrom, who’s set to testify tomorrow. The Federal Trade Commission just called its first expert witness, Jihoon Rim, an New York University professor who’s taught a course about founding a startup and worked as CEO of messaging app company Kakao.

The Fifth Circuit Court of Appeals vacated a preliminary injunction that prevented the law from taking effect while the lower court hears arguments on the merits. The district court didn’t adequately analyze the full scope of platforms the law could apply to, the appeals court says, as required under the Supreme Court’s ruling in an earlier set of cases brought by tech industry group NetChoice.