Hillicon Valley — Feds fight Meta’s foray into VR

The Federal Trade Commission is taking on Meta’s attempt to expand in the virtual reality sector with a lawsuit aimed at blocking the tech giants’ acquisition of a VR company with a popular fitness app.  

In other news, a Senate panel advanced two bills aimed at increasing safety and privacy protections for kids and teens online.  

This is Hillicon Valley, detailing all you need to know about tech and cyber news from Capitol Hill to Silicon Valley. Send tips to The Hill’s Rebecca Klar and Ines Kagubare. Subscribe here.

Meta’s VR acquisition challenged

The Federal Trade Commission (FTC) is trying to block Meta’s acquisition of a virtual reality (VR) company with a popular fitness app through a lawsuit filed Wednesday.  

The FTC alleged Meta’s acquisition of Within Unlimited, the company behind the fitness app Supernatural, would weaken competition in the VR fitness app market.  

• The complaint alleges Meta, the parent company of Facebook, Instagram and WhatsApp, could have built its own virtual reality app to compete in the space but by choosing to buy a potential rival is limiting competition in a way that could lead to less innovation, lower quality, higher prices and less consumer choice.  
  
• The FTC’s lawsuit, against the company and CEO Mark Zuckerberg, more broadly targets Meta’s acquisitions of VR companies in recent years, accusing the company of embarking on a “campaign to conquer VR” dating back to 2014 when it acquired the Oculus VR headset manufacturer. 

Meta’s response: A Meta spokesperson said the FTC’s case is based on “ideology and speculation, not evidence.”

“The idea that this acquisition would lead to anticompetitive outcomes in a dynamic space with as much entry and growth as online and connected fitness is simply not credible. By attacking this deal in a 3-2 vote, the FTC is sending a chilling message to anyone who wishes to innovate in VR. We are confident that our acquisition of Within will be good for people, developers, and the VR space,” the spokesperson said in a statement. 

Read more about the suit.

Senate advances kids’ safety, privacy bills

Two bills that would add regulations on tech companies in a way that aims to increase safety for kids online advanced out of a Senate panel Wednesday with broad bipartisan support.  

The Senate Commerce Committee advanced the Kids Online Safety Act (KOSA) and the Children’s Online Privacy Protection Act, also known as COPPA 2.0. 

Despite broad support for the proposals debated Wednesday, the hearing highlighted divisions among the top members of the committee. 

Ranking member Sen. Roger Wicker (R-Miss.) criticized the panel for not bringing up the comprehensive data privacy bill he introduced. He voted against advancing Sen. Ed Markey’s (D-Mass.) COPPA 2.0 bill, not based on the legislation itself but rather because he thinks the committee should be prioritizing the comprehensive American Data Privacy Protection Act (ADPPA).

• That bill addresses privacy concerns for all Americans and also includes some protections for children that are included in the COPPA 2.0 bill.  

Read more about the vote.

HULU REVERSES POLITICAL AD POLICY

The streaming platform Hulu will now accept advertisements on political candidates and issues following backlash from Democratic campaign organizations over it refusing to run ads on midterm election issues.  

A national Democratic Party official said on Monday that Hulu did not give Democratic campaign groups a clear reason for not running ads on abortion and gun safety that they submitted last week.  

The Democratic Senatorial Campaign Committee (DSCC), Democratic Congressional Campaign Committee (DCCC) and Democratic Governors Association (DGA) submitted the ads to a variety of distributors, including Disney-owned ESPN and a Disney-owned ABC affiliate in Philadelphia, but Hulu was the only one that did not broadcast them.  

“After a thorough review of ad policies across its linear networks and streaming platforms over the last few months, Disney is now aligning Hulu’s political advertising policies to be consistent with the Company’s general entertainment and sports cable networks and ESPN+,” a Disney spokesperson told The Hill on Wednesday. 

Read more here.

EU POLITICIAN LIKELY HACKED WITH ISRAELI SPYWARE

A top European Union lawmaker said his phone was likely compromised by a spyware known as Pegasus, a technology tool developed and distributed by Israeli company NSO Group, Reuters reported on Wednesday.  

EU Justice Commissioner Didier Reynders said in a July 25 letter obtained by Reuters that Apple informed him last year that his iPhone had likely been hacked using Pegasus. 

Apple’s findings prompted an inspection of Reydner’s devices as well as phones belonging to other EU employees.  

Though the investigation into the Belgian politician’s phones was inconclusive, investigators found evidence showing that a hack did occur. 

Read more here.

SMUGGLERS TARGET MIGRANTS WITH MISINFORMATION

Migrants reliant on Facebook and WhatsApp as they make the journey to the U.S. are being targeted with immigration misinformation by human smugglers, a new report found. 

A study released Tuesday from the Tech Transparency Project (TTP) found “an abundance of posts spreading misinformation about immigration law, conditions along the route to the United States, and the opportunities available to migrants to the U.S.” through the Meta platforms.  

Migrants found smugglers promising easy entry into the U.S. via Facebook and WhatsApp, according to the report, with some saying they were instead robbed or left in dangerous circumstances by those they connected with. 

Read more here.

BITS & PIECES

An op-ed to chew on: Why isn’t the Biden administration trying to combat spyware abuse? 

Notable links from around the web: 

Senate’s Antitrust Crackdown Sputters as Schumer Signals Doubts (Bloomberg / Emily Birnbaum) 

Big Tech’s dream of transforming health care is getting the scalpel (Protocol / Joe Williams) 

‘Operating With Increased Intensity’: Zuckerberg Leads Meta Into Next Phase (The New York Times / Mike Isaac)

Lighter click: Step aside, please!

One more thing: ‘Hotel Rwanda’ daughter to testify

The daughter of Paul Rusesabagina, the imprisoned former hotel manager who housed hundreds of refugees during the Rwandan genocide, appeared before the House Intelligence Committee Wednesday. 

Carine Kanimba showed up to testify about a malware attack on her phone allegedly carried out by the Rwandan government led by President Paul Kagame, which has labeled her father a terrorist for his links to an armed opposition group accused of carrying out attacks in the country. 

She says her father was lured from their home in San Antonio, Texas, and brought to Kigali, Rwanda, against his will in August 2020. There, he was arrested and sentenced to 25 years in prison after what Kanimba calls “a sham trial.”  

Read more here and see her testimony here.

That’s it for today, thanks for reading. Check out The Hill’s Technology and Cybersecurity pages for the latest news and coverage. We’ll see you tomorrow.

VIEW THE FULL VERSION HERE