The US Federal Trade Commission and the states of New York, Tennessee and North Carolina are investigating Meta Platforms’ VR business unit Oculus for potential anti-competitive practices, Bloomberg reported, citing sources with knowledge of the matter. The FTC is concerned that Oculus is kneecapping third party VR app developers and undercutting competing VR hardware with below-cost prices.
The FTC and the three states, led by New York, talked to outside developers that make Oculus apps in recent months as part of the inquiry. The officials have been investigating the ways in which Meta may be using its market power in the VR space to destroy competition, said the people.
In interviews with several developers, the antitrust enforcers were interested if competing third party apps sold via the Oculus app store are discriminated as well as about Meta’s sales strategy for the Oculus VR headset, in particular how the price of the company’s device undercuts competitors. Meta sells the Oculus Quest 2 headset for USD 299, well below some models from HTC and others.
The new inquiries follow earlier scrutiny from the Justice Department under Donald Trump’s administration.
Representatives for Meta and the New York and Tennessee attorneys general didn’t respond to requests for comment. The FTC and the North Carolina Attorney General declined to comment.
Developers complained that Meta uses its market position to obstruct companies that offer competing games and services on Oculus. They allege the company copies the most promising ideas and makes it harder for some apps to work properly on the platform.
The inquiry with app developers indicates that the FTC investigation into Oculus goes beyond its acquisitions. The Commission is also scrutinising the purchase of VR fitness app Supernatural, The Information reported in December.
Developers told Bloomberg that Meta had essentially terminated third-party Oculus apps with appealing features and then launched its own versions on those ideas later on. One example given was Yur, a company that made an Oculus fitness tracker that was disabled from working within Oculus games. The tracker almost disappeared after the release of the first-party Oculus Move function.
