In comparison a Facebook account is directly tied to a specific Facebook (the company) owned service - Facebook (the application). You can't just create a Facebook login, you have to also create a (public by default) Facebook profile, probably use your real name and photo to avoid it being banned etc.
Facebook could fix this by letting you create a Facebook (the company) account which is just a username and password, and maybe an email for account recovery reasons. This account would then be used for logging in to all of Facebooks services, Facebook (the application) and Oculus included, while not actually requiring you to ever create a Facebook (the application) profile unless you wanted to.
This is the part that makes it anticompetitive, I would imagine.
Requiring a Facebook login to use the Quest puts the competition at an immediate disadvantage, as they'll have to use their own login or submit to Facebook login as well, often at the cost of cross-platform compatibility. Onboarding friction will always be less with the app where you already have an account.
Facebook told Bigscreen developers to join Facebook or "be crushed": https://twitter.com/DShankar/status/1295825809496629248
But seriously what a dark pattern and just like Little Shop of Horrors feeding the beast really doesn't benefit you. This is exactly why I never purchased an Oculus: because the price of entry for playing a VR game is too high.
Also VR is not only for games. It can be used for remote meetings, design, tourism etc. VR is a different way to work and consume content.
It’s an attempt to force people like me to use another product of theirs so they can extract value from me.
tl;dr The banned account can still play games in offline mode but can't re-download them since this is done through the XBox Live service. Other users of that XBox can do everything as normal including play and re-download games that were installed by the banned account.
If this is being used to bypass a ban, the console will get banned.
[1] Can't find the speed of the latest one but the S5 is a 64-bit dual-core 2.4 Ghz CPU (I think the S6 is 20% faster than that?) with 1 GB of RAM & 32GB of storage. That's a pretty hefty device & will eventually consume a lot of needs for a phone. [2] https://www.apple.com/shop/watch/watch-accessories
I guess I could understand if somebody didn’t have internet access and wants to use Oculus, but they wouldn’t be able to download any games either even if no account was required. The complaint seems like more of an ideological thing against Facebook, but I’m attempting to take it at face value.