FTC and multiple states investigating potential anti-competitive practices by Facebook-owned virtual reality headset maker Oculus
The Federal Trade Commission and multiple states are investigating the Mark Zuckerberg-owned virtual reality unit Oculus over anti-competitive practices.
Oculus is owned by Meta, the new company name of Zuckerberg’s Facebook, the world’s largest social media company.
Led by New York Attorney General Letitia James’ office, outside developers who make apps for the VR tech have been questioned as part of the inquiry.
Anti-trust lawmakers asked developers about the possibility that the Oculus app store is discriminating against third-parties that sell apps in competition with Meta’s software.
Other issues being probed include whether Meta is undercutting competitors by selling the Oculus headset for $299 – well below what other models cost.
Meta employee Elza Uzmanoff tries out an Oculus device at the company’s corporate headquarters campus in Menlo Park, California
Mark Zuckerberg, chief executive officer and founder of Meta, may face antitrust investigations
FTC Commissioner nominee Lina M. Khan is leading the investigation against Meta to see if they’re slowing down third party developers
New York, Tennessee and North Carolina are among the states joining the FTC in investigating. Meta had similarly faced scrutiny from former President Donald Trump’s Department of Justice.
Representatives for Meta and the New York and Tennessee attorneys general have not responded to requests for comment. The FTC and the North Carolina Attorney General declined comment.
The company changed its name from Facebook to Meta in October as part of Zuckerberg’s plan to build ‘the metaverse’ – immersive digital worlds accessed through virtual and augmented reality-powered devices.
Developers argue that Meta uses its power on social media to stop companies from competing with them and copies promising ideas. They also allege that Meta makes it harder for some third-party apps to work correctly on the Oculus.
Cix Liv, the creator of the fitness tracking app Yur Inc., said that his company began to lose traction when Meta put out a software update that stopped the technology from working within games.
New York Attorney General Letitia James’ office is one of several states investigating Meta by interviewing third party developers
The Oculus headset is dominating the current market within VR hardware, making up 75 percent of global shippings as of 2021
Liv, a Silicon Valley entrepreneur who legally changed his name – which is derived from his World of Warcraft persona – said Meta delivered another blow when it released Oculus Move, a very similar app.
Guy Godin, a developer of a virtual desktop app, said he was similarly crushed by Mets.
These investigations are part of the United States government’s quest to regulate Big Tech for conduct that they say undermines competition in the marketplace.
The FTC filed an amended complaint against Meta in 2021 arguing the company eliminates competitors by buying them.
The suit is an attempt to unwind the company’s acquisitions of WhatsApp and Instagram. Meta bought Oculus in 2014 for $2billion.
Oculus is the leader in the virtual reality space, as it currently makes up 75 percent of global shipments of headsets.
Similar to smartphones, Oculus offers an app store that displace both Meta-developed and third-party apps. Oculus gets 30 percent of all sales.