FTC said to lose challenge to Facebook’s purchase of Within


A federal judge in California ruled late Tuesday that Facebook’s parent company Meta can continue to have a virtual reality company, in order to encourage Democrats to end the power of the Silicon Valley tech industry, as anyone familiar with this matter.

The ruling by U.S. District Judge Edward Davila of the Northern District of California denied the Federal Trade Commission’s request to block Meta’s acquisition of popular app developer Within, best known for the app buzzy fitness called “Supernatural,” the man, who asked to speak on. condition of anonymity because the order is sealed by the court. A judge granted the FTC’s request to block the deal from closing until Feb.

Although the judge did not find that this deal was anticompetitive, the order confirmed some of the points the FTC made in its case, including that the acquisition of new companies could hurt competition and even businesses. not now in a market to have control over the market, said the person. This is the first time since 198 that a court has upheld those convictions, the person said.

The court also provided a roadmap for future cases related to competition in fast-changing and digital markets, where new businesses are being created all the time, the person said.

The Washington Post has not seen a copy of the decision and cannot verify those claims. Bloomberg first reported the judge’s decision.

The decision is widely seen as a test of FTC director Lina Khan’s plan to curb Silicon Valley’s market power, in part by bringing long-running lawsuits against digital companies. The new competition movement championed by Khan – sometimes called “hipster antitrust” – argues that antitrust laws affect future competition, not just the current market. Tech giants like Apple, Google, Facebook and Amazon have amassed much of their technological power and talent by crowding out smaller competitors. Changing the implementation to take into account the upcoming competition creates problems in some of their most important business plans.

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The Federal Trade Commission and Meta declined to comment.

“Out of respect for the Court’s orders, the FTC cannot comment at this time,” FTC spokesman Peter Kaplan said in a statement.

The FTC’s case shows where it left Microsoft in December to block the company’s $69 billion acquisition of video game publisher Activision Blizzard, forcing the deal to allow the Redmond, Wash. Federal regulators also sought to freeze past acquisitions. The FTC continues to sue to force Meta to withdraw from Instagram and WhatsApp, and the Department of Justice has taken a case to force Google to sell its advertising business.

However, these actions faced an uphill battle in the US courts, which held a low understanding of what constitutes an antitrust hazard.

While federal agencies have filed antitrust lawsuits against tech companies, congressional efforts to pass new laws to strengthen anti-competitive practices have fallen flat. politics. That effort was included in the proposal last month when the Justice Department and eight attorneys general brought a counterclaim against Google, claiming that the company’s core advertising business would be destroyed.

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The FTC sued the Federal Trade Commission in July to block Meta from insider trading. The buzzy virtual reality app created by Los Angeles-based Within studio offers its users daily exercise routines in extreme locations such as a snowy mountain or a futuristic setting.

The FTC argued that Meta would have made its own VR software if it hadn’t made the acquisition, meaning consumers would have been deprived of that competition and choice. FTC attorneys pointed to testimony by Meta executives who said the company — with specific support from Meta CEO Mark Zuckerberg — wanted to enter the health market to increase the public’s awareness of the truth. actually more than his younger male counterpart. Fitness programs, they report, can bring in women and older users and make using Meta’s Quest VR headsets part of their routines.

Meta’s CEO Mark Zuckerberg cites health as key to metaverse growth

During the investigation, testimony from Meta executives and exhibitors revealed that employees were debating how to enter the fitness industry by repurposing its popular dance app Beat Saber for that purpose. use case. There are also discussions about establishing a relationship with Peloton – an idea supported by Zuckerberg once, according to Michael Verdu, the former president of the giant company of augmented reality and virtual reality.

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But Meta’s lawyers argued that the FTC’s suggestion that the company might enter the VR market itself with its own software was just speculation. Although there were some employees who were interested in establishing an in-house fitness program, the company dismissed the idea too early, Meta argued. They also argued that Meta has faced and will continue to face a strong pool of competitors in reality.

Zuckerberg said in court that under the current economic conditions, Meta would not take on the development of its own software. As Meta seeks to expand the VR fitness market in 2021, the company is trying to figure out how to generate higher revenue than expected. Now that Meta is experiencing a financial crisis, the company is reducing expenses and not spinning new projects.

Since buying tiny startup Oculus nine years ago, Meta has become the leading headset maker in the nascent market, claiming 78 percent of virtual reality headset sales. actually in 2021, according to the lawsuit.

Meta’s reign in space may not last long. PlayStation is planning to release a new virtual reality headset this year. Apple is expected to release a competing headset this year, according to Bloomberg News. High Tech Computer Corp. in Taiwan, and Pico – owned by China’s ByteDance, which also owns TikTok, are also competitors in the space.

The FTC case reveals Mark Zuckerberg’s interest in a VR fitness app


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