Impact of US Regulation on Big Tech’s XR Strategies

The US Justice Department filed an antitrust lawsuit against Alphabet, the parent company of Google, last Tuesday. The lawsuit claims that Alphabet illegally controls digital advertising and requires selling its ad management platform. With Google earning 80% of its income from advertising, the lawsuit could severely impact this key revenue source if successful.

So far, eight state attorney generals have joined the litigation, representing California, Connecticut, Colorado, New Jersey, Rhode Island, New York, Virginia, and Tennessee. Trial to Take Place in Eastern District Court of Virginia, US.

Meta and Google Advert Regulations

The Google antitrust lawsuit could prevent the company from displaying ads on upcoming XR devices, including the future Google Glass for consumers. Currently, Google only has one significant consumer product, the widely used Google ARCore platform designed for public AR experiences.

Google faces a potential penalty similar to Meta, which received a $414 million fine from the European Union last year. Brussels regulators accused the tech giant of violating General Data Protection Regulations (GDPR).

Last year, Meta also faced a revenue crisis due to Apple’s changes in data collection policies. The XR and social media firm lost $10 billion in revenue, leading to a significant dispute.

Regulators to File Antitrust Lawsuits Against Microsoft-Activision

Microsoft is facing legal issues after its $67.8 billion acquisition of Activision Blizzard. On January 17th, Microsoft issued a subpoena to Sony, potentially compromising Sony’s future tech plans. US FTC and European regulators have filed massive antitrust lawsuits against Microsoft, potentially leading to revenue decline and affecting Microsoft’s investments in Metaverse and serious gaming.

Conclusion

Presently, some enterprises may see the Metaverse as a costly gamble instead of a profitable opportunity. With worsening tech and economic conditions, these companies seek simpler, more profitable revenue sources through specific products. In comparison, some investors could offer extra funding and R&D support.

Ultimately, many companies, including leading US tech firms, need to focus on cost-cutting while searching for more sustainable and cost-efficient sources of income for innovation.

The featured image was gotten from Forbes.com