Meta CEO Mark Zuckerberg takes witness stand in FTC case

SAN JOSE, California (AP) — Mark Zuckerberg, the CEO of Facebook’s parent company Meta, took the witness stand Tuesday in a trial over U.S. antitrust regulators’ effort to stop the tech giant from buying a virtual reality startup called Within Unlimited.

At issue is whether Meta’s acquisition of the small company that makes a VR fitness app called Supernatural will hurt competition in the emerging virtual reality market. If the deal is allowed to go through, the Federal Trade Commission argues, it would violate antitrust laws and dampen innovation, hurting consumers who may face higher prices and fewer options outside platforms controlled by Meta Platforms Inc.

Meta, meanwhile, wants to poke holes in the FTC’s argument that there even exists a distinct market for what the FTC calls “VR dedicated fitness apps.”

During his testimony at the trial in San Jose, California, Zuckerberg seemed to play down the notion that fitness is a distinct, top category in VR. He said, while fitness is one “use case” for virtual reality, other uses — namely games, communication and socializing and work — have been the primary ones that Meta has been focusing on.

“While we focused on a number of use cases,” Zuckerberg said, there was a common order of popularity — with games, social and work as the top three and “sort of a longer tail” of other uses for VR that includes fitness.

Whether or not VR fitness apps are a distinct market is key in the case because the FTC is arguing that Meta’s entry into this space through the Within acquisition would stifle competition. If there’s no defined market, it becomes more difficult to prove that case.

The FTC, however, argues that not only is Meta a potential entrant into this market, but that it had the resources and ability to create its own VR fitness app instead of acquiring the top independent player in the market.