Facing FTC Suit, Meta Postpones Supernatural Purchase

Faced with an antitrust lawsuit by the Federal Trade Commission, Meta has agreed to delay acquiring Within Unlimited, developer of the virtual reality fitness app Supernatural, until at least August 6.

Meta had been expected to complete the estimated $400 million acquisition as early as July 31, but the FTC sued on Wednesday to block the deal. Along with its complaint, the agency filed an emergency request for a temporary restraining order that would prevent Meta from completing the deal.

Meta and the FTC said in court papers filed this week with U.S. District Court Judge Edward Davila that the tech company's agreement to postpone the acquisition makes it unnecessary for him to immediately rule on the agency's request to block the deal.

The FTC alleged in its complaint that the acquisition would result in reduced competition in the market for virtual reality fitness apps, arguing that Meta likely would have either developed its own virtual reality app, or added features to Beat Saber (a virtual reality “rhythm game”) had it not agreed to purchase Supernatural.



Meta disputed that claim, stating Wednesday that it considered developing its own fitness service, and decided against doing so.

“The FTC asserts, seemingly based on little more than Meta’s size, that we would either build a fitness-specific service like Supernatural from scratch or somehow convert Beat Saber into such a service,” the company said Wednesday in a blog post. “But given the vastly different uses and audiences for these apps, and the fact that many other well-established brands like Apple and Peloton are far better positioned than Meta to bring their existing fitness products and content to VR, doing so wouldn’t make any sense.

The agency was divided over suing Meta, wiht the three Democratic commissioners voting in favor of a lawsuit and the two Republicans voting against it.

Staff at the FTC recommended against suing, Bloomberg reported Friday.

This new lawsuit is in addition to an existing FTC antitrust case against Meta over its prior acquisition of Instagram and WhatsApp. That lawsuit, first brought in December of 2020, is pending in Washington, D.C. federal court.

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