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US FTC Seeks To Block Meta's Acquisition Of VR Content Maker Citing Antitrust Concerns

Benzinga · 07/28/2022 07:05
  • The US. Federal Trade Commission sought a court order to block Facebook parent Meta Platforms Inc (NASDAQ:META) from acquiring virtual reality (VR) content maker Within Unlimited.
  • The FTC called Facebook a "global technology behemoth," noting its ownership of popular apps including Instagram, Messenger, and WhatsApp. 
  • The FTC argued that the acquisition of Within by Facebook would "tend to create a monopoly" in the virtual reality-dedicated fitness apps market, Reuters reports. Within has a popular fitness app called "Supernatural."
  • Facebook agreed to buy Within in October 2021 for an undisclosed sum.
  • The FTC argued that the planned acquisition was a way for Meta to dominate virtual reality, a new and fast-growing part of the internet. The FTC claimed that VR industry revenues will likely grow from $5 billion last year to more than $12 billion in 2024.
  • Meta already has the best-selling VR headset, the Quest 2, and controls a Meta Quest Store with hundreds of apps. "Meta already owns a best-selling virtual reality fitness app, and it had the capabilities to compete even more closely with Within's popular Supernatural app," stated John Newsman, director of the FTC's Bureau of Competition. "But Meta chose to buy market position instead of earning it on the merits. This is an illegal acquisition, and we will pursue all appropriate relief."
  • In 2021, the FTC accused Facebook of violating antitrust rules by acquiring Instagram and WhatsApp to eliminate them as a competitor.
  • Previously Facebook shareholders alleged the company of overpaying billions of dollars to the FTC in 2019 to protect CEO Mark Zuckerberg from the Cambridge Analytica data breach scandal.
  • Price Action: META shares traded lower by 5.31% at $160.58 on the last check Thursday.