The Perils We Face If the Courts Aspect With the FTC On Meta

The Perils We Face If the Courts Side With the FTC On Meta

(Graeme Jennings/Pool via AP)

Starting this week, a court will consider the Federal Trade Commission’s request to block Meta from acquiring Within Limited, a start-up that created a popular virtual reality fitness app. The case should provide the first test of the FTC’s new claim to vast authority under Section 5 of the FTC Act, which prohibits “unfair methods of competition.” With a win, the FTC could gain the power to set the rules of the road for the entire US economy. With a loss, which is far more likely, the FTC’s grand ambitions could crumple at the starting line.

The FTC sued Meta to prevent it from dominating the “market for virtual reality dedicated fitness apps.” Under traditional antitrust jurisprudence, this case is almost certain to fail because it postulates only very speculative harms to competition. In the first place, there is no “market for virtual reality dedicated fitness apps.” Instead, VR fitness apps compete with other VR apps that encourage movement, non-VR exercise apps, and an entire world of exercise products. This exercise market is incredibly competitive – just look at the pandemic’s impact on gym membership knows.

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