German regulators have recently launched an investigation into Facebook over Facebook’s decision to link its Oculus VR products to its social network platform.
Bundeskartellamt (The Federal Cartel Office) said that it had launched abuse proceedings over Facebook’s proposals to require Oculus 2 VR glasses users to register with a Facebook login.
“Linking virtual reality products and the group’s social network in this way could constitute a prohibited abuse of dominance by Facebook. With its social network, Facebook holds a dominant position in Germany and is also already an important player in the emerging but growing VR market. We intend to examine whether and to what extent this tying arrangement will affect competition in both areas of activity.” – Andreas Mundt, President Bundeskartellamt.
In response, Facebook mentioned that it had stopped sales of its Oculus VR products in Germany.
“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.” – Facebook’s statement.
Facebook had earlier announced that Quest 2 product users would require to login to Facebook with the Quest 2 device and that other Oculus product users could merge their accounts or continue using the Oculus account till January 2023.
The German regulators’ investigation comes just one day after the U.S. regulators filed case against Facebook, accusing it of violating its market power and exploring remedies that could include a forced spin-off of Instagram and WhatsApp.
In 2019, the Bundeskartellamt concluded that Facebook was misusing its dominance in social media to better target based-ads, by pushing users to share data from other Facebook-owned services like Instagram and WhatsApp. Bundeskartellamt gave Facebook time to terminate data collection and to combine it with Facebook users’ accounts without the consent of the users.
Facebook appealed the decision, and a Duesseldorf court ruled that Facebook did not have to comply with the regulations till the case had been decided. This decision was overturned by a Federal Court of Justice in June 2020. The court mentioned that Facebook had to comply with the regulators.
“The fact that Facebook has resorted to various legal remedies is not surprising in view of the significance which our proceedings have for the group’s business model. Nevertheless, the resulting delay in proceedings is, of course, regrettable for competition and consumers.” – Andreas Mundt, President Bundeskartellamt.
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