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Germany launches competition probe into Facebook over VR

December 11, 2020

German authorities have initiated new abuse proceedings against Facebook, this time over its VR headsets. The social media giant is already an important player in what is an emerging market, the antitrust agency said.

DW Shift Virtuelle Realität für Jedermann
Image: DW/D.Späth

Germany's competition regulator on Thursday launched an inquiry into Facebook over the company's decision to link its Oculus virtual reality gear to its social media network, authorities said.

"Future use of new Oculus glasses should not be possible solely on condition that one has a Facebook account," said Andreas Mundt, president of The Federal Cartel Office, or Bundeskartellamt.

"This link between virtual reality products and the social media network could constitute a prohibited use of Facebook's dominant market position," both in terms of social media and VR adoption, he said in a statement.

"We intend to examine whether and to what extent this tying arrangement will affect competition in both areas of activity," Mundt said.

The VR headsets, Oculus Quest, are designed for use in the latest sophisticated games and films. More recently, its use has spread to other sectors, such as health, security, and culture.

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Facebook announced earlier this year that its latest version, Quest 2 would require a Facebook login to use the device. It also said that users of all other Oculus products have until January 2023 to merge their accounts to the social network.

This sparked competition concerns and the Bundeskartellamt finally initiated abuse proceedings.

Virtual Reality?

Facebook had already halted the sale of Oculus products in Germany earlier this year. While it did not detail the reason behind the move, the company said it was not related to the investigation launched on Thursday.

"While Oculus devices are not currently available for sale in Germany, we will cooperate fully with the Bundeskartellamt and are confident we can demonstrate that there is no basis to the investigation," the social media company told the Associated Press.

Facebook acquired Oculus in 2014, also rebranded Oculus Connect as Facebook Connect, and changed the name of its VR team from Oculus Research to Facebook Reality Labs.

Facebook vs governments

The German investigation comes a day after US federal authorities and 48 states filed two antitrust lawsuits against Facebook, accusing the company of using "vast amounts of money" to acquire competition and quash rivals.

The US Federal Trade Commission filed a separate lawsuit seeking to force Facebook to sell off its subsidiaries Instagram and WhatsApp.

The social media giant has also run afoul with authorities in other countries, most recently in Australia.

German authorities have previously sparred with Facebook over the sharing of clients' private data.

Last year, regulators determined that Facebook was exploiting its dominance in social media to better target ads. It did so by forcing users to share data from other Facebook-owned services and third-party websites.

The Bundeskartellamt gave Facebook several months to stop collecting data and combining it with their Facebook account.

Despite an order from the Federal Court of Justice, a top appeals court, to comply with the regulations, Facebook has still not done so and continues to defend its position that there is no antitrust abuse. The judicial investigation into the issue remains ongoing.

adi/ (AP, AFP)

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