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FTC Sues Meta to Stop it from Buying VR Company

Image Source: Game Developer

The Federal Trade Commission attempted to prevent Facebook-parent Meta from acquiring virtual reality startup Within on Wednesday. Therefore, sending the strongest message yet that the organization would take a harder stance on Silicon Valley mergers. Those involving more advanced technologies.

The FTC said in an injunction filed on Wednesday that Meta has the capabilities to create its own VR applications.  This resemble those created by Within, the firm that created the virtual fitness program Supernatural. The FTC asserts that Meta (FB) is attempting to acquire the fledgling business rather than investing in it. Ultimately, which would “[dampen] future innovation and competitive rivalry.”

FTC Claims on Ideology and Assumption

The internet giant was charged with illegally aiming to grow its “virtual reality empire” by the organization in charge of enforcing US antitrust rules.

The business is seeking to develop use cases for its virtual reality headsets. Since Meta has staked its future on augmented and virtual reality technologies. For example, one of the top downloaded apps on Meta’s headset is Supernatural. This for some users, may be their first introduction to exercising in virtual reality.

The FTC’s claim is “based on ideology and assumption, not evidence. ” It is according to a statement from Meta spokesperson Stephen Peters.

FTC accuses Meta of buying its dominance

In an effort to disband the internet behemoth, the FTC has filed another antitrust action against Meta. This is focused on its long-ago purchases of WhatsApp and Instagram. The FTC’s action also comes at a time when legislators are considering laws that may limit the influence of dominant major digital companies like Meta.

When Facebook acquired Oculus in 2014, Meta, then known as Facebook, began its VR venture. It has recently acquired a number of VR-related companies. Those including the game production platform Unit 2 Games and Beat Games, the company behind the well-known game Beat Saber. In addition, in October 2021, Meta made known that it would be acquiring Within for an unknown fee.

Users Must Pay Certain to Continue Virtual Reality

Supernatural was released in April 2020 by Within, a six-year-old maker of VR apps. It costs a subscription, as opposed to a one-time price like some other VR apps. Therefore, users must pay $19 per month or $180 per year to continue exercising in virtual reality.

The FTC alleges in its lawsuit that Meta already holds influence over “the top-selling device, a major app store, seven of the most successful developers, and one of the best-selling apps of all time” in the VR industry. In addition, the agency cited a widely circulated email that Zuckerberg allegedly sent to Meta executives, in which he allegedly stated that it is crucial for the business to be “completely ubiquitous in killer apps,” a reference to the kinds of applications that will demonstrate the true worth of new technologies.

According to Charlotte Slaiman, competition policy director at the consumer group Public Knowledge and a former FTC antitrust official, the FTC’s primary claim in the complaint—that the merger would lessen competition by displacing a rival—reflected decades of accepted antitrust reasoning.

Slaiman continued by saying that it is clear from the complaint that Meta has the capacity to rule the virtual reality market. It’s quite encouraging to see that the FTC is not “waiting to see what happens” in the VR space.

Sheryl Sandberg to leave Facebook and Meta after 14 years

The timing of the FTC complaint, according to Slaiman, might increase pressure on Congress to approve an antitrust law that targets the technology industry and creates new barriers between the many lines of business of tech firms.

The American Innovation and Choice Online Act is a piece of legislation that is waiting for a Senate floor vote, but Senate Majority Leader Chuck Schumer has not placed it on the agenda, and its supporters are running out of time before Congress adjourns for the summer.

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