FTC takes first major step in blocking Meta's monopoly on the metaverse

The Federal Trade Commission has filed a complaint to block Meta’s acquisition of Within, the VR developer behind fitness game, Supernatural. The regulatory group alleges that since Meta already owns Beat Saber, letting it own the app’s premium competitor not only reduces competition but has already influenced the development of future VR apps.

Killer apps — Meta announced it was going to acquire Within in October 2021, citing the popularity of Supernatural as one of the primary motivations for the deal. Supernatural is a popular subscription-based fitness service created by Within, that’s sort of like Peloton for virtual reality, if you subbed out running and cycling for punching and slicing orbs to Imagine Dragons.

The FTC is not wrong to suggest Meta could have turned Beat Saber into a real Supernatural competitor. The company acquired Beat Games, the creator of the sword-based rhythm game, in 2019. Even someone totally unfamiliar with VR could see the similarities between the precise arm waggling both games require.

Monopoly power — The FTC has to justify its actions in terms of competition, the effects a less competitive market could have on the prices, and the quality of the products they receive, but the complaint more or less reads like the FTC is trying to prevent a monopoly.

Meta “has set its sights on building, and ultimately controlling, a VR ‘the metaverse’” the complaint explains. That’s why it’s been acquiring developers to fill up its app store and subsidizing its VR headset to undercut competition. It goes on to suggest that Mark Zuckerberg wants to control “the entire ecosystem” — both the platform and the apps that run on it — likely to avoid the issues Meta’s run into dealing with the privacy controls on Apple’s iPhone. Acquiring apps like Supernatural or Beat Saber is just one component of that plan.

Meta unsurprisingly disagrees. In a comment provided to Input, a spokesperson said: “The FTC’s case is based on ideology and speculation, not evidence... 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.”

It remains to be seen how this will all play out, but clearly the FTC is trying to take a more proactive stance with “the metaverse” than it did social media apps.