**Washington, DC | August 7, 2025 — **A coalition of twelve public interest groups, led by NextGen Competition and Public Citizen, today urged the Federal Trade Commission (FTC) to launch a full investigation into Meta’s investment in Scale AI. The groups’ letter argues that the deal amounts to a de facto vertical acquisition, deliberately structured to exploit gray areas in traditional merger law.
 
“The investment in Scale AI includes all the anti‑competitive hallmarks typical of Big Tech’s minority stakes in generative AI firms,” said Sumit Sharma, NextGen Competition Executive Director. “Here, the harms extend well beyond model development and aim squarely at cementing Meta’s dominance in adjacent markets such as social media and surveillance advertising. Meta already faces an antitrust lawsuit in these markets. Do we really want Mark Zuckerberg and Meta to have even more control over our information ecosystem?”
 
The groups argue that Meta’s 49% stake in Scale AI, combined with its poaching of founder and CEO, Alexandr Wang, raises serious competition concerns by effectively granting Meta control over the company and its intellectual property.
 
Instead of competing by developing its own data annotation capabilities, Meta has moved to absorb the market leader. This action neutralizes Scale AI’s role as an independent, neutral resource for the entire industry and transforms it into a captive asset for Meta’s exclusive benefit.
 
“Meta’s $14.8 billion grab is a blatant attempt to control a competitor, lock up scarce AI infrastructure, and poach top talent all while squeezing out rivals,” said J.B. Branch, Big Tech Accountability Advocate at Public Citizen. “These backdoor deals are deliberately structured to dodge regulatory scrutiny, inching as close to a merger as possible without calling it one. Google, Amazon, Microsoft, and Meta have all participated in these ‘acqui-hires’ which are just anticompetitive behavior disguised as investment. The FTC must investigate this growing trend to protect consumers before the damage is done.”

“Meta’s reckless monopolization of social media through its ‘buy, don’t compete’ strategy has stifled innovation, limited consumer choice, and done lasting damage to our society and democracy,” said Morgan Harper Director of Policy and Advocacy for AELP. “Now it’s running the same playbook in AI, vertically integrating its power through de-factor acquisitions of smaller suppliers. If the Trump FTC is serious about reining in Big Tech monopolies, it must prevent Meta from using its power to entrench its dominance in the next generation of technology.”

NextGen Competition and Public Citizen were joined by the following other groups: The Tech Oversight Project, Tech Justice Law Project, Revolving Door Project, UltraViolet, Consumer Federation of America, Open Markets Institute, American Economic Liberties Project, Institute for Local Self-Reliance, Public Knowledge, and Demand Progress Education Fund. A copy of the letter filed with the FTC is available here.
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NextGen Competition is on a mission to create a fair and competitive technology ecosystem that empowers consumers, workers, and small businesses by supporting robust enforcement of our antitrust laws and policies. Our approach enables many independent technology companies to innovate, and compete, and to offer differentiated services. It also rectifies the profound imbalance of power that allows the largest technology firms to unilaterally set terms and conditions for everyone, and use our data, and capture our attention without meaningful constraints. Additional information is available at https://nextgencomp.tech.
 
**Public Citizen **is a nonprofit consumer advocacy organization that champions the public interest in the halls of power. We defend democracy, resist corporate power, and fight to ensure that government works for the people – not big corporations. Founded in 1971, we now have 500,000 members and supporters throughout the country.