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Facebook acquiring Oculus VR for $2 billion

26 Mar 2014  by   Paul Younger
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Oculus VR Team

The Oculus team appear to be very happy with the deal

Here’s some rather large tech news, Facebook is acquiring Oculus VR for $2 billion in cash and stock. Facebook’s Mark Zuckerberg hit his blog to make the announcement.

I’m excited to announce that we’ve agreed to acquire Oculus VR, the leader in virtual reality technology.

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. We have a lot more to do on mobile, but at this point we feel we’re in a position where we can start focusing on what platforms will come next to enable even more useful, entertaining and personal experiences.

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. The incredible thing about the technology is that you feel like you’re actually present in another place with other people. People who try it say it’s different from anything they’ve ever experienced in their lives.

Oculus started with a highly successful Kickstarter crowdfunding campaign raising over $2 million and has since raised more funds through venture capital funding. The Oculus team will also have the potential to earn a further $300 million in cash and stock as part of this acquisition should they reach certain milestones .

Oculus CEO Brendan Iribe added, “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.”

Oculus also updated their Facebook page with a lengthy post to share their enthusiasm for the deal.

At first glance, it might not seem obvious why Oculus is partnering with Facebook, a company focused on connecting people, investing in internet access for the world and pushing an open computing platform. But when you consider it more carefully, we’re culturally aligned with a focus on innovating and hiring the best and brightest; we believe communication drives new platforms; we want to contribute to a more open, connected world; and we both see virtual reality as the next step.

“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.

But this is 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 or consulting with a doctor face-to-face — just by putting on goggles in your home.

While this is great news for the Oculus team, not everyone is over the moon with the bombshell. Markus “Notch” Persson of Minecraft fame was quick with a reaction. After meeting with Oculus a few weeks ago to discuss the possibility of creating a slimmed down version of Minecraft that would work with the Rift it appears that deal is now dead in the water thanks to Facebook’s involvement.

“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,” said Persson. “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.”

For now at least the Oculus team are focusing on releasing the second development kit for the Rift and their attention is on the gaming market.  With Facebook now involved that’s likely to change as they seek new opportunities for VR in the social space.

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  1. +5

    This is a complete disaster for Oculus’ relations with the vast majority of enthusiast gamers (ie, their market) and independent developers. Hope they still develop some great technology and push the whole field of VR forward, but now I won’t ever be buying any of their products.

    March 26, 2014 at 3:38 am
    1. +1

      I think it’s great for Oculus but frustrating for gaming consumers and backers of the Kickstarter campaign. It’s a shame backers didn’t get a share in Oculus then they would all be richer for it.

      March 26, 2014 at 3:41 am
  2. +1

    This honestly seems like an absolute disaster, except for the few who just got very rich off this deal.

    March 26, 2014 at 3:56 am

  3. Sparky Lawrence

    I’m not wanting to seem like I’m playing Devil’s advocate or anything but a well funded Oculus VR might well make better and cheaper products, even if that funding comes from Facebook. The point is that it’s way to early for us to determine whether this is a good or a bad move on Oculus VR’s part (well at least in all aspects other than the financial gain).

    March 26, 2014 at 6:08 am
  4. My first thoughts on this was negative as well, but it really isn’t

    It is common for large companies to invest in other areas completely unrelated to their main business. As for Facebook, they have tons of money laying around and want more than one leg to stand on, it’s not the first company they’ve bought. They will likely only have economic control of Oculus, with no noticeable difference to the users except perhaps a mention of facebook on the “company” section of their website.

    This is indeed what is necessary to make VR mainstream, which in turn is needed for developers to recognize VR as a thing to spend development time on.
    Oculus needs a lot of money to start large scale production and advertising is really expensive.

    I wouldn’t worry about 3d pop-up ads just yet… Anti-fanboys isn’t any less childish than regular fanboys and I don’t think there are a lot of them, just some who cry really loud right now.

    March 26, 2014 at 1:02 pm

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