U.S. market regulators went to court on Wednesday to block Facebook owner Meta from buying virtual reality fitness app maker Within, in what could be a potential setback to the tech giant’s Metaverse ambitions.
In a complaint filed in federal court, the Federal Trade Commission argued that Meta was trying to illegally expand its virtual reality empire with the purchase of Within Unlimited, maker of the fitness app Supernatural.
Meta is committed to building its Metaverse vision for the future of the web and is placing a heavy bet on the interactive virtual world that the company believes will secure its strong position.
“This acquisition represents a reasonable possibility of eliminating both current and future competition,” the FTC complaint reads. “And Meta would have been one step closer to his ultimate goal of owning the entire ‘Metaverse.'”
The social media giant said the FTC’s move contradicted reality and expressed confidence that buying Within would be good for both VR users and developers building apps in that market.
“The FTC’s case is based on ideology and speculation, not evidence,” Meta said in response to an AFP inquiry.
“The notion that this acquisition would lead to anti-competitive outcomes in a dynamic space with as much market entry and growth as online and connected fitness is simply not credible.”
But the FTC called the acquisition “illegal,” and Deputy Director of Competitions John Newman added, “Rather than compete on merit, Meta is trying to buy its way to the top.”
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Meta is already a leading player in the virtual reality market, and its boss, Mark Zuckerberg, has stressed that the Metaverse is key to the company’s future.
Years ago, the Silicon Valley titan bought virtual reality equipment maker Oculus and Studios, which was dedicated to apps for use in the digital realm.
Meta purchases included a popular Beat Saber game, in which players smash oncoming virtual blocks to the beat of the music.
The FTC said the lawsuit is specifically aimed at preventing Meta and Zuckerberg from getting their hands on Within Unlimited.
The Supernatural app, purchased by independent studio Within, allows users to train in routines set to music by popular artists like Lady Gaga, Katy Perry and Coldplay in realistic, virtual locations like the Galapagos Islands, the FTC said .
The complaint cites Within that fitness apps are “the killer use case for VR.”
Oculus vice president of play Jason Rubin announced the deal to buy Within in October without disclosing financial details.
Supernatural will operate independently as part of Metas Reality Labs if the deal goes through, Rubin said in a blog post at the time.
Supernatural workouts feature routines synced to hit music, real-life trainers and “breathtaking” virtual destinations from Machu Picchu to the surface of Mars, Rubin said.
Some tech world watchers questioned whether the FTC move also sent a “terrifying message” to developers hoping to make money if their creations are snapped.
“How does the FTC expect startup founders and employees to derive cash from their hard work when traditional exit methods are blocked?” Read a tweet to regulators from Samsung Ventures America CEO Michael Pachos’ @pachos account.
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