Horizon Worlds, Meta's first pass at a metaverse, will be inaccessible via virtual reality headset after June 15, 2026. The decision marks another chapter in the company's costly retreat from the vision Mark Zuckerberg championed in 2021, when he rebranded the entire company and committed billions to what he promised would be the future of human interaction.
What makes this shutdown particularly significant, however, is what it says about an antitrust battle that seemed settled years ago. Lina Khan, then-FTC chair, filed suit to block the roughly $400 million deal with Within, arguing Meta was systematically buying potential competitors in VR fitness rather than competing on its own merits. The court rejected her case. Khan lost that fight. Yet Meta's announcement this week suggests her core concern about the company's acquisition strategy in emerging technology markets may have been validated.
Meta's Reality Labs has racked up close to $80 billion in losses since 2020. The unit has become a byword for corporate overreach, burning cash on unproven markets while users largely ignored it. Horizon Worlds never hit any big numbers, with reports saying active users never even passed a few hundred thousand per month. Meanwhile, Meta poured resources into Ray-Ban smart glasses and AI initiatives, pivoting away from the immersive virtual world Zuckerberg once believed was inevitable.
Here lies the tension at the heart of modern antitrust enforcement. Khan's willingness to challenge acquisitions based on potential future harm rather than just current market dynamics may have lost in court, but it's being vindicated by events. Khan argued the company was leveraging its dominant position in VR hardware, which Quest headsets controlled at an estimated 80% of the consumer VR market, to corner adjacent software markets before real competition could emerge.
The argument had internal logic. Meta acquired Within's Supernatural app, as well as Beat Games, maker of Beat Saber. If the metaverse had succeeded—if users had embraced VR social interaction as Khan and Meta executives both predicted—then those acquisitions would have locked competitors out of a crucial new market. But prediction, it turns out, is not a legal standard courts respect easily. Tech industry observers and Meta defenders dismissed the challenge as regulatory overreach: how could you block an acquisition in a market that barely existed?
The legal setback stung. The FTC lost high-profile cases, including antitrust suits it filed against tech companies Meta in 2020 and Microsoft in 2022. Khan faced criticism for being overly aggressive, for targeting companies on theoretical rather than demonstrated harms. Yet Khan lost the legal battle but won the argument, with Meta's decision to shutter Supernatural proving her concerns about monopolistic acquisition strategies weren't theoretical but prophetic.
This raises a genuine policy dilemma. Should regulators wait for clear evidence of consumer harm before intervening in tech markets? Or must they act on forward-looking logic in fast-moving sectors where consolidation happens before competitive dynamics fully mature? Khan's proactive approach to metaverse regulation demonstrates the importance of antitrust enforcement before markets fully mature; traditional antitrust enforcement often waits until monopolistic behaviour becomes obvious and harmful, by which point intervention becomes significantly more difficult and less effective. The FTC's early attention to VR market structure created regulatory uncertainty that may have influenced Meta's strategic decisions and preserved space for potential competitors.
There is no simple answer. Courts understandably hesitate to unwind deals based on scenarios that never materialise. Yet the flipside—waiting until monopolistic positions are entrenched—offers little remedy. Meta spent $400 million on Within, untold millions more on legal fees fighting the FTC, and years of management attention, all for an app it's now closing.
Khan herself departed the FTC in 2025 as political winds shifted. Her successor faces a Trump administration less inclined toward aggressive tech enforcement. Whether regulators will continue her approach remains an open question. But the Meta-Within saga has become a case study in the perils of tech consolidation in emerging markets and the challenges courts face assessing harm that exists only in theory until it doesn't.