According to a Bloomberg report, Meta can proceed with its acquisition of virtual reality startup Within. In a sealed decision, Judge Edward Davila reportedly rejected the FTC’s request to proceed with blocking the transaction.
The FTC filed a lawsuit against Meta in July to prevent the company from buying Within, the company behind the VR fitness app Supernatural, on the grounds that the merger would be anti-competitive. To support its multi-billion dollar wager on the metaverse, Meta has a history of acquiring promising VR technology.
The FTC claimed in court in December that Within’s Supernatural app is an exact rival to Beat Saber, a well-liked VR rhythm game that some people use to exercise.
In 2019, Meta acquired Beat Games, the developer of Beat Saber. Even Oculus, the hardware provider that powers Meta’s premium Quest headsets, joined the team in 2014 after being acquired for $2 billion. And in the final weeks of 2022, Meta officially announced that it had acquired the smart eyewear company Luxexcel. None of the agreements’ terms have been made public.
The government attorneys presented email exchanges from March 2021 that suggested a partnership between Beat Saber and Peloton when the FTC called Zuckerberg to the witness stand. A deal of this nature is no longer on the table, according to Zuckerberg, in part because of the company’s deteriorating financial situation, and it did not advance further. Considering that Meta is currently in a worse financial situation, Zuckerberg testified that a partnership between Beat Saber and Peloton would be impossible (in part due to changing Apple policies, he said).
In the VR space, according to Zuckerberg, he is more interested in social, gaming, and productivity use cases than fitness. Recently, Meta unveiled the Quest Pro, a capable headset made especially for remote work.
Judge Davila may now approve the transaction, but according to Bloomberg, Meta will be temporarily prevented from closing the deal while the FTC decides how to proceed because the agency may still appeal Judge Davila’s decision.