Mark Zuckerberg, the CEO and founder of Meta, took the stand in a hearing about Meta’s purchase of Within, the VR company behind the fitness app Supernatural. In July, Meta got sued by the FTC to stop it from “owning the entire metaverse.”
One of the FTC’s witnesses and an economic expert, Hal Singer, said that “fitness is the linchpin to owning VR” during the seven-day hearing. Plus that this “keeps Mr. Zuckerberg up at night,” which Zuckerberg later denied, claiming he’s not bothered by the VR fitness competition.
Within’s Supernatural is a strong competitor to Beat Saber, a VR rhythm game popular with those that want to work out, argued FTC.
In 2019, Meta bought Beat Games, the studio that created Beat Saber. In 2014, before the company renamed itself to Meta, Facebook acquired Oculus for $2 billion, the hardware company that now produces Meta Quest VR headsets.
Meta never disclosed the terms of its acquisition of Beat Games nor the terms of the potential purchase of Within.
While Beat Saber is just a fun game that requires physical activity, Supernatural is an app dedicated to fitness, including professional fitness trainers and their programs and popular music to listen to while working out.
The FTC, under the leadership of Lina Khan, says that the acquisition of Within by Meta would violate antitrust laws. In a statement about the lawsuit, John Newman, FTC Bureau of Competition Deputy Director, said,
He further went on to say,
Zuckerberg on Meta’s VR Goals and Financial Situation
When Zuckerberg was called to the stand by the FTC, the government lawyers presented email exchanges from March 2021 that suggested a partnership between Peloton and Beat Saber.
Zuckerberg explained that the idea was promising in 2021 because Meta had some money to invest in fitness, but the company ultimately decided to buy Within.
According to Zuckerberg, a partnership between Peloton and Beat Saber would now be impossible since Meta is in a worse financial situation than before. Meta’s investors are voicing their concerns as the company’s revenue declines.
Other than losing billions of dollars per quarter, Meta Platforms laid off thousands of its workers, amounting to 13% of its total workforce. Zuckerberg claimed that fitness isn’t his priority in the VR space and explained he focuses on the gaming, social, and productivity use cases.
Proof of their interest in other VR fields is the company’s recent release of Quest Pro, an advanced headset specifically designed for remote work.
Meta wanted to finish the acquisition of Within by the new year, but the company will delay the deal’s close until January 31st, 2023, according to a court filing from Tuesday.
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