The Oculus Rift, a potentially game changing virtual reality headset originally developed for games and funded by gamers, has just been purchased along with its entire parent company for a cool two billion dollars by Mark Zuckerberg’s Facebook empire. What can the company do now under the control of Facebook, funded by a possibly massive over-valuation?
Oculus Rift began as a vision, stepping into rave reviews from E3 media attendants in June 2012, and on August 31st, 2012 was funded primarily by a group of video game junkies with the ideal that the Oculus could change how immerse our gaming world is today and how we interact with games in the future. In August of 2012 Oculus was worth just over $250,000 – and it was made for the gamer, by the gamer.
Today Mark Zuckerberg drummed up a cool two billion dollars to buy out Oculus and the entire team. Think about that number for a second. That’s eight-thousand times more money than was ever funded through the Kickstarter program. Why would a technology company – a software and services company at that – want to buy the latest in gaming hardware? According to Mr. Zuckerberg, he’s less interested in the gaming side.
“The next major computing platform that will come after mobile. The history of our industry is that every 10 or 15 years there’s a new major computing platform, whether it’s the PC, the web or now mobile. History suggests that there will be more platforms to come and that whoever builds and defines these, will not only shape all the experiences that our industry builds, but will also benefit financially and strategically.”
“Mobile is the platform of today, and now we’re starting to also get ready for the platforms of tomorrow. To me, by far the most exciting future platform is around vision – modifying what you see to create augmented and immersive experiences.”
“Today’s acquisition is a long-term bet on the future of computing. I believe Oculus can be one of the platforms of this future. Immersive gaming is the first big opportunity. But gaming’s just the start. After games, we’re going to make Oculus a platform for many other experiences. Imagine enjoying a court side seat at a game, studying in a classroom of students and teachers all over the world, consulting with a doctor face-to-face or going shopping in a virtual store where you can touch and explore the product you’re interested in, just by putting on goggles in your own home.”
Though Facebook’s Oculus division may be reaching out into a new stratosphere away from gaming in the future, Oculus Co-Founder Palmer Luckey did express that the hardware will stay gaming focused for the moment.
“Oculus’ somewhat unpredictable future just became crystal clear: virtual reality is coming, and it’s going to change the way we play games forever.”
“If anything it makes us more of a gaming company. We’re going to be working on different things, but we’re going to be putting a huge number of people in gaming that we wouldn’t be able to otherwise.”
“We’re going to be able to do a lot more in gaming with this partnership. The idea that we’re going to move resources out of gaming to somewhere else is just not going to happen. The games industry is going to drive virtual reality right now, because the gaming industry is the only one equipped to make immersive, interactive 3D worlds. That’s going to continue to be the case for a long time. We’re gamers, we want to play games, that’s why we’re doing this.”
Without being short-sighted, opposing Co-Founder Brendan Iribe looked toward the future of computing on the Oculus as a platform – more than just a PC.
[The merger with Facebook allows Oculus to] “invent the future. We believe virtual reality will connect people in ways we never before thought,”
“We are excited to work with Mark and the Facebook team to deliver the very best virtual reality platform in the world. We believe virtual reality will be heavily defined by social experiences that connect people in magical, new ways. It is a transformative and disruptive technology, that enables the world to experience the impossible, and it’s only just the beginning.”
Surely Facebook’s new acquisition could allow for new experiences, not the least of which being the firm adaptation of 3D camera technology if the Rift leaps off as the next “must have” platform. What the Rift requires is much the same as we mentioned a few days ago; Support. With Facebook on-board, buying units in bulk through big name outsourced manufacturers is a viable option – meaning cheaper VR units than ever before possible. “We can do these higher minimum orders and these component relationships that for the most part only larger companies can do,” Mr. Iribe also mentioned.
Today, just hours after announcing their merger with Facebook, Mojang boss Marcus “Notch” Persson denounced the Rift entirely, tearing his uber-popular Minecraft from the platform and halting all production for launching in Virtual Reality on the Rift. Marcus said that he won’t work with Facebook – they’re too “creepy” and he’s upset about his investment with the company with this latest development.
“I definitely want to be a part of VR, but I will not work with Facebook. Their motives are too unclear and shifting, and they haven’t historically been a stable platform. There’s nothing about their history that makes me trust them, and that makes them seem creepy to me. And I did not chip in ten grand to seed a first investment round to build value for a Facebook acquisition.”
“Facebook is not a company of grass-roots tech enthusiasts. Facebook is not a game tech company. Facebook has a history of caring about building user numbers, and nothing but building user numbers. People have made games for Facebook platforms before, and while it worked great for a while, they were stuck in a very unfortunate position when Facebook eventually changed the platform to better fit the social experience they were trying to build.”
Those disappointed with the loss of development need not worry however, as Persson may have hinted at a change in direction. While not specifically mentioning his intentions, Notch has every opportunity to work with Sony on their new VR headset, “Project Morpheus“, and tipped that “Competition is a very good thing.” Marcus also noted a bit about the difficulties of developing the Rift, which may lead to bumps in the road for the newly acquired Facebook division – issues that existed before Facebook took the helm.
“Of course, they wanted Minecraft. I said that it doesn’t really fit the platform, since it’s very motion based, runs on Java (that has a hard time delivering rock solid 90 fps, especially since the players build their own potentially hugely complex levels), and relies a lot on [Graphical User Interface]. But perhaps it would be cool to do a slimmed down version of Minecraft for the Oculus. Something free, similar to the Minecraft PI Edition, perhaps? So I suggested that, and our people started talking to their people to see if something could be done. And then, not two weeks later, Facebook buys them.”
With interface difficulties an issue for Notch, Mark Zuckerberg may be looking at the Oculus Rift as an opportunity, but how can Facebook benefit from the technology? The Rift as it exists works by interfacing with a camera, the camera reading points on the headset to move the player through a virtual environment, eliminating the need for physical interfacing. The closest competing technology – Google’s “Glass” project works in just the opposite direction – adding a visual interface to your real physical life.
Facebook is betting on the idea that within a few year’s time we are going to want to experience life from within the home as opposed to staying connected on the go. Mark Zuckerberg is betting that we are going to want to voyage to the Grand Canyon and the Himalayas without leaving the couch. While both technologies can co-exist, Facebook must break the barrier between the virtual and the physical, allowing us to use the Oculus without a keyboard and mouse in non-gaming activities before it’s truly effective. Take into account for their creation of an artificial intelligence disivion and purchase of speech recognition companies in the fall of 2013 and Facebook may just be driving in the right direction with Rift for those who want to dive into the virtual “real” world.
So now what, Facebook? Where are you taking all of the great talent and technology of the world? Where ever that may be, if they can afford to drop two billion on a relatively niche tech company then the answer isn’t far off.