Facebook Bought Oculus: Is VR Dead Before It Began?

James Bruce 28-03-2014

What happens when the little guy that everyone loves to rally behind gets sucked up into an evil corporation and becomes rich? A veritable storm of writhing anger, apparently. That’s what happened when Oculus – makers of the Oculus Rift VR headset – announced they had been sold to Facebook for the princely sum of $2 billion in cash and stock options.


“When Facebook first approached us about partnering, I was skeptical. As I learned more about the company and its vision and spoke with Mark, the partnership not only made sense, but became the clear and obvious path to delivering virtual reality to everyone. Facebook was founded with the vision of making the world a more connected place. Virtual reality is a medium that allows us to share experiences with others in ways that were never before possible”. – Palmer Luckey, CEO of Oculus VR

Cries of “Farmville VR coming soon!” and “friend request popups in the matrix, argh!” were juvenile at best and don’t merit further discussion. Of note however was Notch, creator of the mega-hit Minecraft, who shortly after hearing the news declared his interest in developing a Rift version of Minecraft firmly off the table.

Not that it actually matters, since there’s already a stunning community mod called MineCrift, one of the most popular games for current devkit owners. The developer community at large has taken the news altogether more stoically than the ex-fanboys of r/oculus.


Why Facebook? WHY?!

At first glance, Facebook and Oculus are polar opposites – a complete mismatch of technology companies. Facebook is in the business of selling user data gathered through some web software – the very definition of an evil corporation that everyone loves to hate. Oculus is the upstart, led by the soft-spoken hero Palmer Luckey to fame and glory by thousands of Kickstarter backers who believed in the product, and in him. So why would Facebook have bought Oculus – and for such a significant price? I have three, not mutually exclusive, theories:


1. Mark Zuckerberg has an awful lot of pocket money and likes to buy shiny things. He was probably just as blown away upon donning the latest prototype as everyone else was. He threw down a blank cheque and screamed TAKE MY MONEY. I feel much the same way, hence why I pre-ordered the second iteration of the developer’s kit as soon as it was announced; and will certainly be buying a consumer version when it’s released, as well as countless controllers and peripherals to greater immerse me in virtual worlds. If I had billions to invest, I sure would’ve put those into Oculus too.

2. Facebook made a long-term strategic business decision about a future computing platform in order to stay relevant. People were just as perplexed back in 2005 when Google snapped up Android Inc, a mobile phone software company. “Wireless will be the next frontier for search” they claimed, and many scoffed. Now mobile represents as much as 30% of internet browsing. Facebook is an incredibly successful internet platform, for messaging, sharing, and real-time chat. Oculus, and VR in general, is just another platform that in 10 years will likely be just as ubiquitous as the mobile phone is today.

3. As Jessie J tells us – everybody’s got a price. Oculus’ price was $2 billion, the point at which it would simply have been stupid to say no. There is no doubt that Oculus had ben courted by other eager firms, some of whom the community would almost certainly have appreciated more. Firms like Valve, Google, or heck – even Microsoft (actually, no – I take that back, not Microsoft – the great killer of all things that are cool 3 Reasons Microsoft Is Losing The Plot [Opinion] Are we in the midst of the final days of Microsoft as we know it? Feedback from tech professionals about Metro UI has been predominantly negative so far, but that's the least of our worries... Read More ). But none of them fronted a price that Oculus found acceptable; Facebook did. There’s also the fact that selling out to Apple or Google would have meant destroying their current vision and being fully swallowed into the parent company’s game plans – Facebook will allow them to continue operating independently (or at least, so we are told).

So What Does This Mean for Oculus’ Future?

Facebook hasn’t yet destroyed Instagram or WhatsApp, despite the same initial fears that it would flood the apps with advertising or require Facebook login. Oculus has ben given the same promises: that nothing in their vision will change, and that current gaming focus will come first. At some point down the line, a VR environment similar to second life with Facebook avatars and inevitable advertising is likely, but not yet; and who cares? What else does the acquisition mean for Oculus’ future?


Cheaper hardware. Palmer has specifically said that the deal allows them to reduce or remove hardware margins, meaning a cheaper Rift for everyone. The price of entry will still be high considering the high-end PC you need to power a satisfying stereoscopic HD VR experience, but at least getting the Rift into peoples’ homes will be a little easier.

Oculus-branded controller. At the moment, the Razer Hydra Razer Hydra Review and Giveaway Say the words "motion controller" to any serious gamer, and they'll screw their face up and scream gimmick. The WiiMote, Playstation Move, Xbox Kinect - none of these have made any real difference outside of... Read More is widely regarded as the standard for VR interaction controllers; yet another peripheral to add to the list. Razer is rumored to be working on their own version of a VR HMD; and with the resources of Facebook behind it, it’s not unreasonable to think Oculus is working on creating their perfect VR controller too.

Custom content. It’s all about the killer app. Though the hardware itself is expected to remain a fully open system, there’s nothing to stop Oculus now creating the real killer app that will only work with the Rift and not competing devices. For me, the Tuscany demo they supplied with the original development kit remains a highlight; if that were fleshed out to a full role-playing game, I’d be a very happy boy indeed.

Custom hardware. At the moment, Oculus is using off-the-shelf screens designed for smartphones. It works, but it’s not ideal. Designing custom hardware is a massive undertaking, and a hugely expensive process that will only be possible now that they have the bankroll of Facebook behind them.


“This deal is going to immediately accelerate a lot of plans that were languishing on our wishlist, and the resulting hardware will be better AND cheaper. We have the resources to create custom hardware now, not just rely on the scraps of the mobile phone industry.”

In a word: possibilities. Oculus can go from being a niche VR headset maker, to a complete VR platform for everyone; providing content, enticing developers, and creating compelling VR solutions.

The future just got here rather quicker than we were expecting, and I’ve never been more excited. Are you as excited as I am? Or are you going to call me a shill for Facebook?

Image Credits: Sergey Galyonkin Via Flickr

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  1. Yannis V
    March 31, 2014 at 3:47 am

    VR dead? Not by a long shot. Is the Facebook acquisition of OR a possible change in its direction? Maybe.

    I used to follow the OR project very closely because virtual reality has been something I was looking forward to since I was very young. Now that Sony has shown off their own project, my attention has shifted to the PS4. The reason is that VR to me is primarily about immersive gaming experiences. Unless Facebook has something they are working on that is related to gaming, I'm not interested in the Oculus anymore. When I say gaming I don't mean byte sized casual experiences that Facebook is used to bringing. I'm talking about console/PC type AAA titles.

    VR is very much alive and, in my humble opinion, it's going to be big. Maybe even big enough to change the world. We have the technology to make it possible. In the beginning it will be expensive not just to buy the gear but also the games that will be built with VR in mind.

    I had said in the past, when the PS4 and Xbox One were first revealed, that they were great gaming systems but had nothing truly new to bring to the table. A VR headset would have sold them to me. Now that Project Morpheus has been shown I'm more than hype to see what happens in the next few years.

    This all being said, I do also believe that VR has applications in other areas of our lives. My main focus may be gaming but it will be interesting to see what the future holds for social media, web browsing, information access and how the new virtual experience will enhance our lives.

  2. dragonmouth
    March 30, 2014 at 4:54 pm

    "Facebook hasn’t yet destroyed Instagram or WhatsApp"
    Give it a chance. FB may yet become the killer of all things cool. They have not been around and axquiring as long as M$. Remeber the AOL - Time Warner deal. It was also supposed be about future synergies, blah, blah, blah. AOL ,too, had lots of money burning a hole in their corporate pockets.

    Luckey sold out but, then, $2 billion in hand is worth $many more in the bush.

  3. Ron M
    March 29, 2014 at 9:54 am

    doesn't matter to me because it's not ready for the mainstream yet anyway. Or more specifically, the mainstream isn't ready for living room VR yet.

  4. Don Gateley
    March 28, 2014 at 6:18 pm

    Don't the VC investors have sufficient power to force such a sale to turn their investment into profit? Their interests are much more short term than that of the Oculus management. I'd be surprised if VC agreements don't have sale price triggers built in. All Zuckerberg needed was to know that price and be willing to pay it.

    I think Luckey et al are making the best of the inevitable. Excellent analysis, BTW.

    Personally I think this will be a step function for non-gaming app development and therein lies my sole interest in the Rift and why I bought a DK1 as soon as it went on KS. That space has developed far too slowly for me and I'm excited about how this might accelerate development within it. I expect FB to fund such work since anything that boosts Rift adoption can only benefit them now. I just hope they don't impose an Apple-esque app approval filter to protect their own flanks.

  5. Dapper
    March 28, 2014 at 5:50 pm

    I'm open to see what happens. Perhaps the future isn't dead just yet ;)

  6. Sukkerberg
    March 28, 2014 at 4:54 pm

    My first reaction to this news was horror, upon thoughtful consideration it became utter depression. FB has killed our dreams.

  7. dragonmouth
    March 28, 2014 at 1:16 pm

    It is the second time around for VR. It was touted as "the next bif thing" in the 1990s and it fizzled. We'll see how far it gets this time.

    • Oswaldo
      March 28, 2014 at 7:44 pm

      I believe the computer platforms in the 90's weren't powerful enough to deliver on the promise of VR. Just try to remember processor speeds back then. As you say, it's "wait and see" now...

  8. paul
    March 28, 2014 at 1:01 pm

    Im interested in VR, but personally i wont ever touch a Oculus Rift. Its dead to me. Its as if it never existed or went out of business.

    Ill look forward to Sony's Project Morpheus, Valve VR or even Microsoft. Its not like we're out of options in terms of VR, no? If it indeed takes off, my bet is that better things will come from Sony or Microsoft, than (shudder) Facebook

    • James B
      March 28, 2014 at 4:20 pm

      Do you have a reason, or is that just an emotional response against Facebook?

    • paul
      March 28, 2014 at 4:53 pm

      @James B
      both, logical and emotional. cant see anything worthwhile coming from facebook. again, they're not the only option in the future. people behave like OR "is" VR, and without them its doomed. please...
      Itll be great for facebook casual gaming and cash-strapped indies on pc scene, other than that, they cant compete in terms of games with Sony/MS/Valve

    • Tom W
      March 29, 2014 at 1:46 am

      Have Valve entered the VR scene? The last I head was that their prototype was for research only, and wouldn't be released to the public in any form.

    • Tom W
      March 29, 2014 at 1:49 am

      I think this is very much a "wait and see" situation. I, personally don't believe that Facebook will harm the Oculus Rift, but I also don't think that the Rift is the best VR solution out there right now. From what I've seen, CastAR may have the edge.

    • James B
      March 31, 2014 at 9:03 am

      To add: Valve doesnt have a VR device, only a reference model; and I personally doubt the "next-gen" consoles are equipped for VR. Having used the last generation of the Sony HMD, I also found it pretty uncomfortable to take off and put on. (my review )

  9. Proximo
    March 28, 2014 at 12:38 pm

    Will Facebook destroy VR? The short answer is no. Sony is releasing their VR headset for the PS4 in the near future, Google is investing in a similar space with Google Glass, and I am sure Microsoft is looking into VR at some level.

    Will Facebook destroy the Oculus product?

    As a hard core gamer, I am not very happy with Facebook stepping in to an arena they know little about. I think Facebook may push the Oculus in a different direction to line up with their vision which is not gaming, although Facebook enjoys some great success with casual games on their platform.

    No one knows what will happen with the Oculus with Facebook in control but I don't necessarily think they will destroy the product. How would the Oculus compete with Sony in this space? They don't have the funding to take on the giants, but maybe with Facebook funding, it may stand a better chance. Facebook is not focused 100% on gaming experiences, but I don't think VR would have been used only for gaming anyway.

    Sony made it clear that Project Morpheus is not just for gaming and that they are working on other type of content such as exploring Mars with support from NASA.

    Time will tell, but VR is a hot button now. I only hope that it moves forward with great apps which is what VR needs right now.