That has the potential to be extremely effective. Anyone using a service solely for the network effect could switch to another one, which could be a large fraction of the users and reintroduce meaningful competition.
The biggest problem is protocol complexity. If Facebook adds some kind of timeline feature or anything like that, do they have to add it to the protocol other providers interface with Facebook using? If so, they can stamp out competition by adding so much complexity to the protocol that challengers can't keep up with it. If not, they can add features that challengers can't interface with. And expecting technologically-sideways regulators to arbitrate that sort of thing is a big ask.