This is a good move by Facebook. VR is going to be huge, huge huge. It might even be as big as Bitcoin. :)
I think what Oculus did was massively de-risk their next ten years. In their business plans, there were undoubtedly very large gray circles with things like "gain overwhelming market share (how?)" and lists of competitors that included, well, everyone in tech.
If you had to pick a tech company to leverage your disruptive new consumer technology, and make sure it kept the 'awesome', and was hacker friendly, who would you go to?
In exchange, they probably lopped another 10-50x of potential value off the top of their company. Not that they won't see some of that realized in Facebook if this is succesful -- they will. But, they will be sharing the gain around in exchange for getting access to that giant global customer base and being able to tap the considerable resources available at FB.
> If you had to pick a tech company to leverage your disruptive new consumer technology, and make sure it kept the 'awesome', and was hacker friendly, who would you go to?
I expected Microsoft to grab them and I'm surprised they didn't. Would've made a smart fit with Xbox and given them easy ways to directly integrate it with their OSs. Would work well with gaming, education, eventually business, mobile and so on. $2b a few months ago would've been a small price to pay to get in early on this, unless they have something comparable up their sleeves from the research division.
When big companies buy small good products, they often turn to poop, because the new masters lack the original vision and the decisions about the product will be made by PMs trying to get a promotion, not by those who actually care. I suspect this will be the case with this acquisition. My opinion is based on the way I see facebook managing their products: whatever they're offering to ordinary users is mediocre and basically stays afloat only because of the network effect, and whatever they are offering to their paying customers is effectively a scam (youtube search for "facebook fraud"). I can't see them possibly making good use of Oculus.
Spoken like an investor who knows nothing about the audience. Sorry, VR was intended for PC gamers. They're not casual mobile gamers. They loathe casual games. They now loathe VR for wedding with Facebook.
I think a lot of the problem is that VR as a means of improving the process of "experiencing interactive content" only really works when the content is presented from a first-person view and there is value in that perspective. Right now, that means FPS and FPRPG games. Amnesia through the Oculus Rift is a genuinely amazing (and terrifying) experience that is improved by the headset (it makes you, the player, feel like you can't step back and escape, which adds to the experience); shopping in a virtual shopping mall is just an impediment to getting what I want.
Remember the VR-32 and VRML? Everyone was super excited that we were going to start doing all the things in virtual reality, and then we figured out that it's a really cumbersome way to present most information.
Sure, I understand that. My point is that perhaps folks who went to the trouble of dedicating their lives to VR might have a larger vision than this.
In 1992, you could have defined the Internet in similarly limited terms -- after all, using the Internet largely meant text interfaces. I'm just positing that the folks who run Oculus are a) smart and b) have spent a lot of time thinking about how best to spread VR.
If VR takes off, by definition it will mean expanding beyond FPS games, because most people do not play those (you could alternatively get VR to go mainstream by increasing market penetration of FPS and FPRPG games by orders of magnitude, which might be harder than putting VR to other uses).
I'm certainly willing to be wrong - I'm not an expert in the space beyond having been an enthusiast gamer for 20 years (and I recognize that doesn't give me domain authority) - but I've been waiting for VR to be a thing for a long time now, and while it's had some neat demos, it's almost never something that I look at and decide that prefer over more traditional interfaces.
Carmack is a ridiculously smart guy who is damned good at squeezing things out of hardware that shouldn't be possible, and if there's anyone that I think could work out the how-to of VR, I think it'd be him, but I'm not sure that I trust his read on what the markets want.
The question isn't so much "will VR take off?" as it is "what could VR possibly do beyond FPS games that could make it take off?" and I just don't have any answer to that at all.
Yes, but first it has to win the gaming market, or it's a non-starter. Games are the Facebokulus's killer, game changing, app. Everything else is just speculation, and will take a while and will build on whatever happens in gaming, because VR gaming is already here.
Now, I understand that in the Kickstarted it was promised only the first developer kit and that it was successfully delivered, but I feel very uneasy knowing that the Facebook platform is geared exclusively to casual gaming. My worry is that Facebook will be happy with a VR technically good enough for a social VR but that can't stand the requirements for gaming. I may be too old to understand, but I really don't feel the urge to interact in 3d with my friends to say hello or to watch their holiday's pictures.
VR, at least as it stands right now, is squarely in the domain of the enthusiast, which has a very broad overlap with PC gaming crowd. Something like the Oculus Rift has no real potential with mobile gaming (power requirements alone preclude that).
What sorts of applications can you imagine? The idea of virtual presence being a killer app is silly, IMO - I've played with both the Oculus Rift and telepresence robots - they're neat, but for meetings/gatherings, I'll take a plain old webcam any day. I can't imagine what Facebook would do with this that I would be interested in.
Isn't that what they exactly did? They got all the PC gamers on fire, got Carmac, got bought by facebook. Now they're reaching for the moon, they became so big that people started hating, you can't avoid that.
I don't think people are upset because they "got big", but because they were acquired by a corporation that signals a core shift in their ideals. If they were bought by Valve, or even Microsoft, I don't think there'd be nearly as much backlash -- because it's not that they're BIG, it's that Valve and Microsoft would not be pushing for a different market with their product (not to say they wouldn't later).
This is a terrible move for Oculus, though. The reaction from their core audiences - hardcore gamers and developers - seems to be largely negative, at a time right after Sony - a company that caters to that audience - announced its competing "Project Morpheus". It's not being taken as a signal of Facebook's innovation, but as Oculus moving toward a casual audience, and their fan base feels abandoned. Do they really feel that whatever plans they have with Facebook are so low-risk and high return that they no longer need that audience?
The world's reaction is also negative. They don't want to wear a box strapped to their face to interact with their friends. Seriously, look at the reaction on Twitter by non-gamers and Facebook users. It's being met with incredulity and mockery.
They don't want now, but wait 'till Facebook does "their magic" on them :) That "networking effect" stuff is not buzz-speak, and they know how to wield it.
Plus, gaming and socialization go hand in hand - it's amazing that others just don't fucking get this yet and see "gamers communities" as just niches or islands.
They already had that audience - down the line, once they have established their beachhead. Selling themselves to facebook doesn't bring it any closer.
>If you had to pick a tech company to leverage your disruptive new consumer technology, and make sure it kept the 'awesome', and was hacker friendly, who would you go to?
Or Blizzard. They have an actual virtual world already. I can easily see WoW fans who already sit at a PC and buy special hardware for their games to flock to VR tech.
> Not that Mr. Newell hasn’t had opportunities to sell out. Valve has been pursued over the years by Electronic Arts, which would very likely have valued Valve at well over $1 billion had the talks progressed that far, said two people with knowledge of the discussion who spoke on condition of anonymity because the talks were private.
> Although Valve’s finances are private, Michael Pachter, an analyst at Wedbush Securities, estimates that the company could be worth around $2.5 billion today.
It's guesswork and no method is explained though, so it's not like that's a very reliable estimate or anything.
My bold prediction: Facebook will be broke in five years, gone in ten. Anyone getting into bed with them now is putting the noose around their own neck.
Facebook is a prototype of what "social networking" should be. Anyone who took five minutes out of their day could think up ten ways "social networking" could be better, and probably all of them would be incompatible with facebook's business model.
IANABP (..Business Person) but their 2 big acquisitions have increased their share of the social/data/identity pie considerably. Yes, these can be very ephemeral and the market can change on you (as MySpace will gladly tell you), but having 1.1B+ monthly actives on your core platform alone (plus however much instagram+whatsapp do) gives you a lot of room to try and recover when things start shrinking.
The oculus VR acquisition feels special, in that they aren't just buying users/reach, but something more substantial and forward looking. If they're smart, they'll let the oculus team work on the track they've been on, and let Facebook teams develop the "non-gaming VR experiences" they want to push.
Hard to think how much the landscape would need to shift for FB to be broke in 5 years. If Oculus delivers on their VR dreams, that alone could potentially bring an almost-bankrupt FB back from the brink.
I find it's very easy to imagine how the landscape could change for FB to be broke in five years; Anyone can build a better way to "social network", and anyone will. Guaranteed. The only real question is... what happens if Facebook can't buy them?
I admire what Facebook has achieved, but it's clear to me that they don't understand what their actual role is, or what people "want" from Facebook as a company if it is to survive. There is an air of mild desperations to the whole enterprise that hints at the acknowledgement of an imminent demise. This acquisition reeks of that desperation.
False false false; this is the dead of Oculus for one simple reason: Developers, doesn't matter how much ridiculous amounts of money you have if you scare away developers making it part of one of the spammiest and most hatred companies in the world it will fail.
Part of the reason I asked if I could cancel my preorder of Dev Kit 2 was some bad experience with Facebook dicking devs early on. Unless they've changed their tune in recent years, I don't understand how this could bode well for their support audience.
I agree that it is a good move, but not because of takes away risk. It's because Facebook has a great deal of users, money, and apparently vision. I had no idea Zuck was this smart (although building Facebook into a giant ought to have been a good clue).
Oculus isn't being conservative here. They're shooting for the moon.
I think what Oculus did was massively de-risk their next ten years. In their business plans, there were undoubtedly very large gray circles with things like "gain overwhelming market share (how?)" and lists of competitors that included, well, everyone in tech.
If you had to pick a tech company to leverage your disruptive new consumer technology, and make sure it kept the 'awesome', and was hacker friendly, who would you go to?
In exchange, they probably lopped another 10-50x of potential value off the top of their company. Not that they won't see some of that realized in Facebook if this is succesful -- they will. But, they will be sharing the gain around in exchange for getting access to that giant global customer base and being able to tap the considerable resources available at FB.