Meta Defends VR Deal From FTC in Court Trial for ‘Potential Competition’

Meta’s Virtual Reality startup deal is currently being questioned in court by the FTC, and here’s why.

The Federal Trade Commission has taken on Meta in a federal courtroom in San Jose, California, to block the company from buying the virtual reality startup called Within.

The FTC’s legal action against Meta, which has acquired more than 100 smaller businesses in the previous ten years, marks the first time it has done so in advance of a deal.

Meta has been working to build its massive metaverse, which aims to be a more immersive version of the internet where users can visit one another’s virtual world to buy, go to work, and visit friends.

Meta’s Argument Against the FTC Regarding VR Competition

Tech Times previously reported that the FTC filed a lawsuit against Meta over the transaction in July, arguing that the business intended to establish a virtual reality monopoly similar to how Facebook acquired Instagram and WhatsApp to increase its dominance in social networking. 

The government agency sued Meta in an effort to void those agreements. However, the case is still ongoing as of writing.

According to Bloomberg’s account of the trial, the accusations are disputed by Meta, which claims that their business decision is not as malicious as the FTC claims it to be.

“We are confident the evidence will show that our acquisition of Within will be good for people, developers, and the VR space, which is experiencing vibrant competition,” Meta spokesman Christopher Sgro argued. “The FTC’s case is based on ideology and speculation, not evidence. We are ready to make our case before the court.”

Additionally, Meta claims that the virtual reality sector is still quite competitive and active. It has referenced the virtual reality headsets released by TikTok’s parent company ByteDance Ltd. and Sony Group Corp.’s Playstation VR headsets in Europe and Asia, as well as predictions that Apple Inc. may enter the market with its own product, which is the rumored AR/VR headset.

Read Also: Meta Adds Parental Guidance to Quest VR Headsets and Instagram to Include Viewing of Total Screen Time and Purchases

Antitrust Experts Weigh In on Meta, FTC Trial

According to the New York Times, sudden lawsuits have been filed by the Federal Trade Commission and the antitrust division of the Justice Department in an effort to block corporate mergers and promote competition for the past years. 

Antitrust experts claim that the FTC’s objective is to expand the scope of how antitrust law can be used, particularly how it has been used in the past against the biggest tech corporations. However, experts agree the current lawsuit against Meta may be hard for the FTC to win. 

Experts point out that the FTC is using an unusual justification in the case by claiming that Meta’s deal would harm potential competition in a market for virtual reality products that may be strong in the future. Including Meta’s lawsuit, the FTC has already filed eight lawsuits challenging corporate mergers.

Related Article: How to Turn Facebook Messenger On and Off in Meta Quest VR | Oculus Communication

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