The Federal Trade Commission (FTC) has lost to Meta.
An FTC official recently revealed that the agency would not be appealing the federal court order allowing Meta to acquire VR startup Within following the court order's grant on Feb. 5, per Reuters.
The FTC previously contested Meta's acquisition of Within due to its reducing the competition in the potential "killer app" category of fitness apps.
FTC vs. Meta-Within Acquisition Details
FTC officials mentioned in a call with reporters that the agency was unable to prevent Meta's acquisition of Within and will not be contesting it any further after a federal judge granted the social media giant a court order allowing the deal to proceed, per The Verge.
They also mentioned that its failure to prevent such a merger wouldn't harm its abilities to improve competition in the broader tech industry. One such official noted how a federal judge's ruling agreed with the agency that courts should consider a merger's potential to harm competition when litigating merger cases in the future.
The FTC previously sued Meta to stop its acquisition of Within, the company that developed the popular fitness app "Supernatural" in July 2022. The agency previously stated that the merger would expand Meta's dominance in the VR market, with it pointing to Meta's acquisition of Beat Games, the video game developing company behind Beat Saber.
The FTC has reason to oppose Meta's acquisition of Within. The company previously acquired several other small companies that had the potential to become competitors, an action which eventually culminated in the FTC suing Meta to prevent its acquisition deal with Within to push through.
Though the federal judge deemed on Feb. 5 that the FTC would be unlikely to win, it did present the necessary amount of evidence for it to prevent the merger from happening, per Legal Dive.
Regardless, this loss to Meta is one of the first major losses of the FTC under Chair Lina Khan, known for being a tech antitrust pioneer.
The news of the FTC's concession to Meta is a welcome tune to Meta, with a company spokesperson saying that the idea of its acquisition deal with Within being anti-competitive is "simply not credible," per CNBC.
The spokesperson also added that Meta was pleased to hear about the court's decision to deny the FTC's motion to block its acquisition of Within, which it nearly gave up on when the FTC presented enough evidence to stop the deal from closing.
The FTC's Other battles
The FTC is not yet done fighting what it deems as anti-competitive behavior. The agency is also preventing Microsoft's acquisition of Activision Blizzard as it might lessen competition within the video game industry.
FTC director Holly Vedova stated that Microsoft has alrady shown it can and will withhold content from its gaming rivals - something that the FTC wants to prevent.
The agency also wants to prevent Microsoft from harming its competitors in multiple dynamic and fast-growing gaming markets. However, it may be in for a difficult battle as the case's merits are difficult to judge.
In a legal filing last month, Microsoft wrote that "the commission cannot meet its burden of showing that the transaction would leave consumers worse off." It also added that the transaction would allow consumers to play Activision's games on new platforms and access them in new and more affordable ways.
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