FTC Sues To Prevent Meta’s Purchase Of A Virtual Reality Company
The US Federal Trade Commission (FTC) has filed a lawsuit against Meta and CEO Mark Zuckerberg to prevent the social media giant from “owning the entire metaverse”.
Meta’s plan to buy a VR sports app maker is in danger of falling apart because the US Trade Commission (FTC) has filed a lawsuit against parent company Facebook.
The FTC claims that Meta’s acquisition of VR development company Within and fitness app Supernatural was unlawful under American antitrust rules and is a form of “competition based on merit” in a case that was filed today in the Northern District Court of California.
According to a statement released by the lawsuit today, Meta is a “promising participant in the virtual reality sports app industry” with the resources to create its own app but instead chose to purchase Within and Supernatural. The action would put an end to “innovation and competitiveness” amongst domestic businesses.
“The acquisition of new users, content, and developers will contribute to the company’s self-reinforcing leadership position. This stifles market dynamics that should be promoted by competing companies in beneficial ways, such as adding useful features to their products or hiring more employees.”
FTC also points Meta has acquired numerous well-known VR firms
The FTC also points out that over the past few years, Meta has acquired numerous well-known VR firms, including Beat Games, the group behind the well-known VR game Beat Saber. Similar findings were made by the agency regarding how various studio ownership might impact innovative competition.
Last October, Meta unveiled plans to buy Within for $400 million. On August 1, the transaction is likely to proceed as scheduled barring any court intervention.
The lawsuit move does not seem to make Meta “startled” because this is not the first time. Earlier in 2020, the FTC filed a complaint against Facebook (before changing its name to Meta), for its $19 billion acquisition of WhatsApp (2014) and Instagram for $1 billion (2012) with similar concerns. . The FTC asserted that acquiring these platforms posed a direct threat that made it difficult for competitors to achieve scale in the field.
In the past, Siu, Founder and Executive Chairman of Animoca Brands, has also called Meta a “threat” to the open metaverse in an interview.
In the statement, Meta denied the FTC’s claims, arguing that the acquisition would help “inject new investment into VR fitness” and denying that Supernatural and Beat Saber are similar experiences.
The Meta rep responded:
“The FTC case is based on ideology and speculation, not evidence. The view that the acquisition will lead to anti-competitive results in a dynamic space with a lot of entry and growth like online and connected fitness is simply unreliable.”
Since rebranding to Meta in October 2021, the social media company has successively announced numerous initiatives to expand into the metaverse and NFT. In May, Meta opened its first brick-and-mortar store offering virtual reality gadgets in the San Francisco Bay Area.
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FTC Sues To Prevent Meta’s Purchase Of A Virtual Reality Company
The US Federal Trade Commission (FTC) has filed a lawsuit against Meta and CEO Mark Zuckerberg to prevent the social media giant from “owning the entire metaverse”.
Meta’s plan to buy a VR sports app maker is in danger of falling apart because the US Trade Commission (FTC) has filed a lawsuit against parent company Facebook.
The FTC claims that Meta’s acquisition of VR development company Within and fitness app Supernatural was unlawful under American antitrust rules and is a form of “competition based on merit” in a case that was filed today in the Northern District Court of California.
According to a statement released by the lawsuit today, Meta is a “promising participant in the virtual reality sports app industry” with the resources to create its own app but instead chose to purchase Within and Supernatural. The action would put an end to “innovation and competitiveness” amongst domestic businesses.
“The acquisition of new users, content, and developers will contribute to the company’s self-reinforcing leadership position. This stifles market dynamics that should be promoted by competing companies in beneficial ways, such as adding useful features to their products or hiring more employees.”
FTC also points Meta has acquired numerous well-known VR firms
The FTC also points out that over the past few years, Meta has acquired numerous well-known VR firms, including Beat Games, the group behind the well-known VR game Beat Saber. Similar findings were made by the agency regarding how various studio ownership might impact innovative competition.
Last October, Meta unveiled plans to buy Within for $400 million. On August 1, the transaction is likely to proceed as scheduled barring any court intervention.
The lawsuit move does not seem to make Meta “startled” because this is not the first time. Earlier in 2020, the FTC filed a complaint against Facebook (before changing its name to Meta), for its $19 billion acquisition of WhatsApp (2014) and Instagram for $1 billion (2012) with similar concerns. . The FTC asserted that acquiring these platforms posed a direct threat that made it difficult for competitors to achieve scale in the field.
In the past, Siu, Founder and Executive Chairman of Animoca Brands, has also called Meta a “threat” to the open metaverse in an interview.
In the statement, Meta denied the FTC’s claims, arguing that the acquisition would help “inject new investment into VR fitness” and denying that Supernatural and Beat Saber are similar experiences.
The Meta rep responded:
“The FTC case is based on ideology and speculation, not evidence. The view that the acquisition will lead to anti-competitive results in a dynamic space with a lot of entry and growth like online and connected fitness is simply unreliable.”
Since rebranding to Meta in October 2021, the social media company has successively announced numerous initiatives to expand into the metaverse and NFT. In May, Meta opened its first brick-and-mortar store offering virtual reality gadgets in the San Francisco Bay Area.
DISCLAIMER: The Information on this website is provided as general market commentary and does not constitute investment advice. We encourage you to do your own research before investing.
Join CoinCu Telegram to keep track of news: https://t.me/coincunews
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