Oculus VR has been purchased by Facebook. The social media giant dropped $2 billion in cash and stock options, a sum that splits into roughly $400 million and 23.1 million Facebook shares.
The social network clearly values the virtual interaction device and intend to make use of it in the not so distant future.
The acquisition came with a status update from Mark Zuckerberg, the creator of Facebook. We'll hone in on a few chunks of it here and now.
"Our mission is to make the world more open and connected. For the past few years, this has mostly meant building mobile apps that help you share with the people you care about," Zuckerberg starts.
He goes on a bit later, "This is where Oculus comes in. They build virtual reality technology, like the Oculus Rift headset. When you put it on, you enter a completely immersive computer-generated environment, like a game or a movie scene or a place far away."
"Immersive gaming will be the first, and Oculus already has big plans here that won't be changing and we hope to accelerate. The Rift is highly anticipated by the gaming community, and there's a lot of interest from developers in building for this platform. We're going to focus on helping Oculus build out their product and develop partnerships to support more games. Oculus will continue operating independently within Facebook to achieve this."
We think that paragraph above is being largely ignored by gamers, but we'll hit on that more below. We'll finish talking about Zuckerberg's announcement with this from him: "But this is just the start. After games, we're going to make Oculus a platform for many other experiences. Imagine enjoying a courtside seat at a game, studying in a classroom of students and teachers all over the world or consulting with a doctor face-to-face — just by putting on goggles in your home."
Gamers, Oculus Rift Kickstarter Backers and Internet goers internationally are up in arms over this deal. Are they right to be mad?
You know what? I'm going to start with what I saw when I woke up this morning. I read Reddit a few times a day, and I always swing by the Gaming subreddit to take a quick glance.
Here's a screenshot of how I found the joint.
The top two discussions surround VR gaming. One gives Redditors instructions for cancelling their Oculus Rift pre-orders, while the other suggests Sony's Project Morpheus is the community's only hope.
I'm not going to pretend I wasn't totally flabberghasted by the news. I had kind of assumed it would happen, but I wasn't sure when or which company.
I mean, I think it's hilarious that the creator of DOOM and Wolfenstein 3D is now an employee of Facebook.
For this discussion, you and I are going to play harsh opposites. We already lean in the directions we've chosen, as we discussed before getting in here to chat, so this isn't too big of a deal. But I'd like us to be a bit more passionate and heavy-handed with our opinions regarding this purchase.
Just, like, no mean name calling.
I think gamers are rightfully upset about this Facebook acquisition. We'll get into the nitty gritty, but Facebook, regardless of what Zuckerberg said in his announcement that we picked apart above, does not operate in the best interest of gamers and Oculus VR fans.
That makes the purchase problematic. Eric?
Like I said, I was blown away by the news, but I also think people are having a lot of knee jerk reactions to something we barely know anything about. I think an acquisition was always coming, and I don't think it's so much good or bad for gamers as it is necessary.
For gamers, I think it's fair to be upset by the company that made the acquisition. Were it, say, Valve or Microsoft (I'm sure that would upset some, of course), I don't think there'd really be this much ire. People would likely still be mad about it, but not to the degree that they are now.
Facebook has, for better or worse, created such a strange image for themselves on the Internet at-large. It's a great place for me when it comes to sharing pictures of my son with my family and friends. It's awesome for that.
For gaming? Facebook has become sort of a bastion for free-to-play experimentation and quick cash-ins. I did an interview with my mom about her decision to pay for Candy Crush Saga a while back, and Facebook's role in that piece was little more than a platform for turn begging and progression bragging.
We, as gamers, don't want something as pure and original as Oculus VR mixing in with Facebook. That might sound crazy and irrational, but applying what Facebook has become to what Oculus Rift is currently makes us nervous.
I understand gamers' concerns, but I think the concerns are premature.
I agree with you on the image Facebook has garnered over the years, and that's precisely why I was so surprised.
You mentioned Valve and Microsoft earlier. I think the list of companies that could afford Oculus is really short. Microsoft, absolutely. Facebook and Google, again yes. Valve I'm not so sure about. They're not exactly strapped for cash, but do they have $2 billion sitting around? I'm not so sure. And I've heard that $2 billion was kind of a lowball.
I also don't think gamers would've been happy about any acquisition with the single exception of Valve. Even Microsoft would've been frowned upon.
And yet, I really don't think Oculus could survive long term without a purchase like this.
Zuckerberg's post, as you mentioned, says that the gaming aspects of the product won't change because of the purchase, and I think that's true. As far as we know, founder Palmer Luckey is staying with the company, and John Carmack only just recently moved over full time, so I can't imagine he's going anywhere. This doesn't seem like a cash grab by the founders to get rich and buy their gold Ferraris, it seems like an infusion of cash combined with stable corporate backing.
Well, sure. However, regardless of Zuckerberg's status update, this acquisition harms one of the fundamental pillars of the Oculus Rift. Heres a single line from the Rift's Kickstarter page: "Designed for gamers, by gamers."
Now, like you said, the designers aren't changing (so far as we know), but this acquisition suggests that the purity of intention is changing.
You're right, Oculus VR needed a backer. That had to happen. The vision and the potential of this platform was way too big for an independent company to push out the door alone.
However, Facebook brings way too many unwanted frills to the equation. Instead of being a platform built for gamers, by gamers, Oculus Rift is now going to be a platform built for the masses.
Yes, it'll still play games. But instead of being a pure gaming experience, the potential and signs are there that indicate this will be riddled with ads, feature forced and haphazard design updates and operate with Facebook's (and only Facebook's) best intentions in mind.
I know that your point is that it's too early to tell, but I think the very principles that Facebook has put on display since its inception are what's making gamers mad. Those principles will absolutely carry over into Oculus VR.
Well, it was designed by gamers for gamers, and now it's being backed by a corporation. While gaming was the impetus for its creation, I think Oculus was open pretty early on about there being other applications for the device, and I think the military has already expressed interest in various uses for it.
I don't think, for example, that we're ever going to need a Facebook login to use an Oculus Rift. I think this is still a far more open device than Sony's headgear. Despite the fan love they've garnered recently, Sony's known more for weirdly proprietary hardware than they are for being open. Even if this is Facebook backed, it's still a PC device, and that'll make it very hard for anyone to completely lock down.
What gamers wanted was a nice David and Goliath fantasy to hang onto. They wanted to cheer for the Kickstarted company that they backed and to see it go big and take over the industry from small beginnings. In a way, it did – VR just became a $2 billion industry overnight. But not in the way they wanted.
I think this is partially a problem related to the way people perceive Kickstarter. When a lot of people contribute to Kickstarter, they think they're now chairman on the board of investors when really what they did was give a company that might not make anything a sum of money they were okay not getting back. Lots of gamers feel like betrayed investors when they're really not.
See, I'm almost wagering things will turn out a little more frustrating than you are. I do think that Facebook will require logins. They will also likely hit us with ads tailored to our profiles. That's the company's biggest money-maker right now, why wouldn't they use it in a display platform that's exclusively their own?
The Facebook phone didn't take off because there are already plenty of other options. That was a chance for Facebook to make a platform device that was exclusively their own. It flopped.
VR? Facebook just acquired the market leader in VR futures. If VR takes off, there's no way Facebook's entry will flop at this point.
I think what we're ignoring here is the potential effect this buyout has on developer willingness to take part. Facebook, as a platform, has been unkind to developers. They demand a big slice of the action, and they make changes to their service without taking developer needs into consideration.
Markus "Notch" Persson of Minecraft fame, for instance, announced that he'd cancelled the world building game for Oculus Rift after the news of Facebook's purchase was made public. Why? Here he is.
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.
Don't get me wrong, VR is not bad for social. In fact, I think social could become one of the biggest applications of VR. Being able to sit in a virtual living room and see your friend's avatar? Business meetings? Virtual cinemas where you feel like you're actually watching the movie with your friend who is seven time zones away?
But I don't want to work with social, I want to work with games.
Fortunately, the rise of Oculus coincided with competitors emerging. None of them are perfect, but competition is a very good thing. If this means there will be more competition, and VR keeps getting better, I am going to be a very happy boy. 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.
I have the greatest respect for the talented engineers and developers at Oculus. It's been a long time since I met a more dedicated and talented group of people. I understand this is purely a business deal, and I'd like to congratulate both Facebook and the Oculus owners. But this is where we part ways.
What do you make of that?
I think Notch has the prerogative to do as he likes, and he certainly has the money and success to allow it, but making a huge business decision 15 minutes after the announcement is really immature. He comes off like someone grousing on a messageboard, except he's a millionaire doing it.
I think that, yes, social will become a much bigger use of the hardware than it was before, but I don't see it negatively affecting the gaming applications. Actually, let me revise that. I do see it affecting gaming applications in that a bunch of indie developers who were previously interested might now choose to distance themselves from the product.
Well, where's the positive in that?
And I guess that's where we start to come together. I don't think Facebook is going to use this to hypnotize us and trap us in the Faceverse, and I think that aligning themselves with a bigger company was a good idea. I don't think Facebook itself is going to be harmful to the Oculus Rift, and I don't think Facebook is going to wall it off.
What I think is harmful to the Oculus Rift is Facebook's negative image. People feel tethered to Facebook, and they use it despite disliking it. That image is going to push away the early adopters an independent developers even if the purchase and months to come aren't as problematic as a lot of people think.
I'm okay with meeting in the middle there. This totally seems planned, but it wasn't.
I do think Facebook's negative image is a big problem for this acquisition. Whether it's folks worried about privacy, developers worried about sour treatment or gamers worried about being hit over the heads with custom ads, Facebook needs a better image moving forward.
While you think it might come, I'm not so sure. Which means we're stuck waiting.
What do you think, readers? Should gamers be mad about Facebook's decisions to buy Oculus VR? Or, is this a good thing for the virtual reality company?