The Federal Trade Commission (FTC) has filed a complaint against Meta to block it from acquiring virtual reality company Within.
FTC states in the complaint that Meta has the resources to develop its own VR apps similar to those made by Within, the company behind virtual fitness program Supernatural.
However, Meta is trying to acquire the upstart company, which would dampen “future innovation and competitive rivalry.”
The FTC alleges that this acquisition would reduce Meta’s incentive to develop its own competitor to Supernatural, or to add new features to Beat Saber, a Meta-owned VR app that the FTC claimed occupies a similar space as fitness app, Supernatural.
The agency believes that Supernatural and Beat Saber compete with each other in certain aspects, adding that “the two companies currently spur each other to keep adding new features and attract more users, a competitive rivalry that would be lost if this acquisition were allowed to proceed.”
However, in a blog Meta responded by saying that “Beat Saber and Supernatural are fundamentally different products with different user bases, different use cases and different competitive dynamics.”
Meta also mentions that Within’s leadership team agrees with their viewpoint and does not consider Beat Saber to be its competitor.
The FTC is accusing Meta of illegally attempting to expand its ‘virtual reality empire’.
The agency says that Meta already controls “the top-selling device, a leading app store, seven of the most successful developers, and one of the best-selling apps of all time” in the VR space.
John Newman, the Deputy Director at the FTC Bureau of Competition said, “Instead of competing on the merits, Meta is trying to buy its way to the top. This is an illegal acquisition, and we will pursue all appropriate relief.”
On the other hand, Meta spokesperson Stephen Peters said that “the idea that this acquisition would lead to anticompetitive outcomes in a dynamic space with as much entry and growth as online and connected fitness is simply not credible.”
“By attacking this deal in a 3-2 vote, the FTC is sending a chilling message to anyone who wishes to innovate in VR. We are confident that our acquisition of Within will be good for people, developers and the VR space.”
Meta is also battling another FTC antitrust lawsuit that is seeking to break up the tech giant, centering on its years-old acquisitions of Instagram and WhatsApp.