According to a recent filing in the U.S. Federal Trade Commission's antitrust lawsuit against Meta, Meta CEO Mark Zuckerberg, Instagram head Adam Mosseri, and other Meta executives believed that TikTok was outperforming Meta in its core business areas.

Dating from February 2022, the document contains exchanges between various Meta executives regarding Facebook and Instagram's strategic approach and standing within the market. In one particular message, Zuckerberg described Facebook as a "challenger," asserting that it had "lost the collective attention and forward impetus," while also observing that TikTok fosters a "sense of shared understanding" through friends encountering the same popular cultural content, as he conveyed.

Mosseri also agreed that Facebook should now be seen as a competitor, saying it's not the main way people find things anymore. He suggested that YouTube might be the most popular way to find things now, but he thought TikTok would become more popular than YouTube eventually, based on the information Meta had.

Mosseri suggested that Facebook's most logical approach to stand out is to serve as the primary platform for content discovery, yet he noted the surprising success of TikTok, a video-only platform, which is significantly outperforming them. He speculated that TikTok is expanding the social mobile market and is also encroaching on the audience for television, long-form video, and Netflix.

Empirical evidence substantiated Mosseri's assertion that TikTok surpassed YouTube in terms of average watch time in the United States in 2021, according to one study. Furthermore, a separate study conducted by Qustodio, a purveyor of parental control software, revealed that children aged four to eighteen allocated 60% more time to TikTok than YouTube in 2023. In a strategic manoeuvre to compete with YouTube, TikTok commenced facilitating 60-minute uploads last year.

This week, Netflix launched its own feature similar to TikTok within its mobile application, presenting a novel vertical video stream of suggested content, tailored to each user.

However, during the legal proceedings, the U.S. government is endeavoring to establish that Meta contravened competition statutes through its acquisitions of entities such as Instagram and WhatsApp, thereby consolidating a dominant position in social networking. A document of this nature could potentially compromise their argument, considering that Meta executives were, internally, contemplating the extent to which Facebook was being outperformed by TikTok.

For example, Zuckerberg observed that although Facebook retained its position as the dominant application in terms of daily or weekly user engagement, it had been surpassed in terms of time spent.

He further posited that TikTok fosters a sense of shared context among users. He elaborated that a convergence of interests between individuals and their peers would likely result in encountering analogous content within their respective TikTok feeds.

That makes it naturally social because instead of sending content to a friend, you can just assume they've seen it," the CEO said. "If we could reach this level with topics and separate content on Facebook, that would be very good."

Other executives also interjected their perspectives.

Will Cathcart, head of WhatsApp, noted that TikTok users commenting on videos within a specific niche could lead the algorithm to repeatedly present them and other commenters with similar content.

Stan Chudnovsky, then a Vice President and General Manager at Meta, remarked that Meta had entered a highly fragmented market with numerous companies hindering its expansion.

He further elaborated that merely introducing a new format, as they had done with Stories, was no longer sufficient, acknowledging the proliferation of alternative platforms where individuals engage, and referenced popular social applications in the U.S. such as TikTok, Twitter, iMessage, Snap, YouTube, Reddit, and Discord.

John Hegeman, then Vice President of advertising and now Chief Revenue Officer, conceded that TikTok was undeniably ahead in domains such as brief video content, ranking functionalities, and creation utilities, but suggested Meta could bridge the disparity by incentivising creators to share content on Reels as well.

However, he expressed less certainty regarding the extent to which Meta lagged in machine learning, technical capabilities, and creation tools, with the document suggesting Meta perceives Facebook as trailing behind in the social media landscape.

This document is not the only one that has appeared during the trial to show that Meta is worried about competition. Last month, Zuckerberg himself said that TikTok's success was a risk to Meta's business and had made it grow more slowly.