One of the rising stars of the COVID era has been TikTok, the Chinese-owned video-sharing app that’s enchanted teens and young adults, while causing privacy concerns for our nation’s leaders.

But American-owned Instagram announced this week that it will launch a competitor by early August. The new feature, called Reels, is almost identical to TikTok.

What will Reels offer?

Reels will be a feature embedded in the Instagram app. Users will be able to access it by clicking a new icon at the bottom of the screen. They will then be able to create a 15-second video with their choice of music from a large library of songs. Instagram already compiled this wide songbook of licensed music before the launch of the popular Stories feature. But in terms of user interface, Reels will look nearly identical to TikTok.

The major difference from the Chinese prototype is that posts on Reels will disappear when the story expires. TikTok, on the other hand, allows users to revisit videos permanently. If creators want to save their videos on Reels, they’ll have to add them to their profile.

Rolling Out the Feature

Reels will be available in the U.S. and 50 other countries by early August. It first launched last year in Brazil, and has also had trial runs in Germany and France. Additionally, Reels is available in India, which was TikTok’s second-largest market until its government banned the app last month over cybersecurity concerns.

If you are a casual Instagram user and are not looking forward to the inevitable avalanche of Reels stories, fear not. You can mute these stories by clicking a circular icon at the top of the home screen and holding down until a pop-up appears. Select “mute,” then “mute story.”

There are also rumors of a potential Reels app that is separate from the main Instagram app. This would be an attempt to recreate the TikTok experience.

Imitation is the Sincerest Form of Flattery

Reels will not be the first time that Instagram, which is a subsidiary of Facebook, has stolen popular features from other apps. Stories were originally a function of Snapchat, before Instagram recreated the feature and, using the same name. The move ultimately benefitted Instagram, as many users abandoned Snapchat for Instagram’s version of the Stories feature.

In 2018, Facebook created an app called Lasso with many of the same functions as TikTok. But Lasso never gained much steam. Facebook is now dismantling the app to make way for Reels.

American Future?

The timing of the Reels launch is not insignificant. Just this month, Secretary of State Mike Pompeo warned that the White House might ban TikTok in the US over privacy concerns. The app, which is owned by the Beijing-based company ByteDance, collects data from its users, many of whom are minors. Fears have now mounted in the States that the Chinese government has easy access to these data. If a TikTok ban is on the horizon, Reels will be waiting in the wings.

Ridesharing and food delivery giant Uber is reportedly in negotiations to purchase Grubhub, a rival food delivery service, in an all-stock deal. This acquisition comes amid coronavirus-related shutdowns that have all but halted Uber’s ridesharing service while aggressively bolstering demand for at-home food delivery.

Doubling Down

The move indicates Uber’s acknowledgment that it must pivot focus to food delivery for the time being. While its flagship ridesharing operation is perhaps its most identifiable service, by 2019, Uber Eats had already become a more profitable venture. Now, with restrictions against social gatherings, workplaces closed and fears about being in confined places abounding, Uber is looking to embrace and buttress its second most popular market segment.

“If you can’t beat ’em, eat ’em.”

Right now there are three main players in the food delivery industry. As of March, DoorDash handled 42% of sales, Grubhub followed 28% and Uber Eats was last with 20%.

Uber has a double incentive to swallow up Grubhub now, before DoorDash can make the move. By acquiring the second-largest player in the food delivery game, Uber not only knocks out an opponent, but Uber Eats becomes the market leader the day the deal closes.

Jesse Reyes, the CEO of J-Curve Advisors, says of Uber’s strategy, “If you can’t beat ’em, eat ’em.”

Antitrust Concerns

Uber’s scramble to eat up the competition is raising some alarms among monopoly watchdogs. Rep. David Cicilline (D-RI), the chair of the House Antitrust Subcommittee, calls Uber “a notoriously predatory company that has long denied its drivers a living wage.” He continued to say that Uber’s “attempt to acquire Grubhub—which has a history of exploiting local restaurants through deceptive tactics and extortionate fees—marks a new low in pandemic profiteering.”

While Uber’s move is certainly opportunistic, is it illegal? Antitrust laws exist to protect smaller businesses from being pushed out of the market by an unbeatable Goliath. Such laws also seek to prevent collusion between large firms to fix predatory prices that would bar other companies from entering the market and eviscerate fair competition. An acquisition by Uber is likely to be held under tight scrutiny, especially by the Democratically controlled House of Representatives.

Continued Haggling

No official acquisition has been confirmed just yet, but the two companies are in discussions on how to best combine forces. One GrubHub statement confirmed that the move is at least being considered, stating “consolidation could make sense in our industry.”

Meanwhile, rumors of haggling between the two companies suggest that Uber allegedly rejected an all-stock offer and that Grubhub demanded that investors receive 2.15 Uber shares for each share of Grubhub. Uber’s board of directors will convene in coming days to review the proposal.