Facebook is being accused by VR startups of using shady competition tactics to muscle them out of the VR market. These accusations have led to the US Justice Department's antitrust division eyeing the company for an investigation.
What are the accusations being levelled against Facebook?
According to Bloomberg, software developers are accusing Facebook of a "copy, acquire, and kill" strategy to undermine competition in the VR market. Developers say Facebook is using its market dominance to steal ideas from them, then making rival apps harder to operate or use on Oculus platforms. This means the social media giant's copied alternative is the only one that works correctly, ensuring users can't download or use rivals and effectively muscling them out of competition.
One example given in the Bloomberg article is Yur Inc, a fitness startup creating Oculus tech for tracking exercise and other fitness metrics. According to co-founder Cix Liv, Yur struggled to meet Facebook's exacting standards for getting its app onto the Oculus marketplace. In spring, Facebook launched an Oculus software update that killed Yur's functionality, with subsequent updates requiring the Yur app be deleted in order to operate Oculus headsets. After this happened, Facebook launched Oculus Move, a platform Liv says has "the same functionality and look" as Yur's tech.
In addition to these allegations, developers are also saying that Facebook is selling its Oculus headsets at a loss, making it impossible for smaller companies to compete. Due to its colossal size, the company can afford to make a loss on hardware, while other manufacturers may rely on hardware sales in order to stay afloat. Stan Larroque, the founder of Paris-based VR startup Lynx, says Facebook "[doesn't] care if [it] makes money or not, but [they'll] flood the market".
How is the antitrust division getting involved?
According to the above Bloomberg article, the Federal Trade Commission is getting ready to bring an antitrust case against Facebook soon. That case doesn't pertain to the VR sphere; instead, it's mostly focused on whether the company's acquisition of Instagram and WhatsApp hurt competition in those fields. However, Bloomberg also says "two people familiar with the matter" have disclosed that the Justice Department is talking to VR developers about their interactions with Facebook and Oculus, which could signal another investigation into antitrust breaches in this area.
This comes against a backdrop of increasing worry regarding Facebook's access to user data. In July, Washington Representative Pramila Jayapal called the social media giant a "case study...in monopoly power" because the company "harvests and monetizes" user data, then uses that data to "copy, acquire, and kill" its rivals. Earlier this year, a "safety video" on the official Oculus YouTube account declared that upcoming VR social space Horizon would continually record users' experiences to spot code of conduct breaches.
How do you feel about Zuckerberg and company's purported shady tactics? Let us know in the comments below!
