FTC files lawsuit against Meta over attempted monopolisation of metaverse
FTC had earlier filed another lawsuit against Meta for attempting to monopolise the social media
By Shashank Bhardwaj
The Federal Trade Commission (FTC) filed a lawsuit against Meta and its CEO Mark Zuckerberg in the Northern District of Carolina. According to the agency, this move is taken against Meta, suspecting its motives to crush any competition in the virtual reality market.
This move is similar to what was seen in 2020 when the FTC filed a complaint against Facebook for its acquisition of Instagram and Whatsapp as a clear attempt to own the competition in the social media market.
Meta’s potential acquisition of the virtual reality company Within, along with its fitness app Supernatural, has raised red flags. The FTC considers the move illegal, as per the US antitrust laws. The officers at the agency suggest that this move indicates that Meta is trying to buy its way to the top of the virtual reality market rather than tackling competition on its own merit. Statements released by the FTC officials suggest that this is just one of the several moves Meta is planning to take to acquire a monopoly in the Virtual Reality universe or the metaverse.
The complaint mentions, "As Meta fully recognises, network effects on a digital platform can cause the platform to become more powerful—and its rivals weaker and less able to seriously compete—as it gains more users, content, and developers. It added, “The acquisition of new users, content, and developers each feed into one another, creating a self-reinforcing cycle that entrenches the company’s early lead. This market dynamic can spur companies to compete harder in beneficial ways by, for example, adding useful product features or hiring additional employees.”
FTC says it plans to block Meta's attempts to acquire Within and thus support healthy competition, ultimately benefiting consumers. The official agency statement suggests that the possibility of Meta entering the fitness business through virtual reality has influenced the competition and consumers. Meta purchasing the biggest rival in this domain will only break this competitive chain. FTC has planned to move against Meta in this regard in the same way as it did in 2020 for the acquisition of Instagram and Whatsapp.
Meta has started aggressively moving forward in expanding the metaverse as it has plans to launch a payment platform which supports crypto payments. The brick-and-mortar store where people can buy hardware for the virtual reality space in the San Francisco Bay Area is another milestone for the company. And with this court case moving forward-unless the judgment is passed against Meta, the company is all set to acquire Within on August 1.
The writer is the founder at yMedia. He ventured into crypto in 2013 and is an ETH maximalist. Twitter: @bhardwajshash
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