Facebook and Oculus Rift: Could this be Zuckerberg's Android?
Oculus is an intriguing company, a Kickstarter-powered attempt to build a virtual reality headset that actually works. Perhaps that's why Facebook's $2bn acquisition of the company yesterday surprised many — and upset even more.
The Oculus Rift is designed primarily for gaming, but Facebook CEO Mark Zuckerberg has grander ambitions for the VR headset than that.
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Facebook was slow to capitalise on the growth of mobile and Zuckerberg very clearly doesn't want to make that mistake again. As such, his last two acquisitions work in tandem: $16bn for Whatsapp is an expensive way of shoring up Facebook's mobile position in the present, while $2bn for Oculus is a bet on the next big thing for the future.
"There aren't that many services in the world that can reach a billion people, and all the ones that do just end up being incredibly valuable. Similarly, with Oculus, there are not that many companies that are building core technologies that can be the next major computing platform," he said on the investors' call about the deal.
This is hardly the first time virtual reality has been touted as the next big thing; various attempts have been made since the 1980s, mostly thwarted by the cumbersome and costly nature of VR headsets and the motion sickness their lag induced. However, Zuckerberg argues that VR hardware is now easier to manufacture thanks to mass-produced components, ushering in cheaper headsets that do away with motion sickness.
Zuckerberg's vision is of a future where the use of virtual reality is pervasive: from consumers using it to check out the view from the best seats at a sporting event, to remotely consulting their doctor, to "going shopping in a virtual store where you can touch and explore the products you are interested in just by putting on goggles in your own home".
In terms of making money from this virtual reality future, Zuckerberg was a little vague, but advertising — a vital revenue stream for Facebook — will clearly be in the mix.
"We do this as a software and services thing. If we can make it so this becomes a network where people can be communicating and buying things and virtual goods, and there might be advertising in the world — but we need to figure that out down the line then. That's probably where the business will come from," Zuckerberg said.
This is perhaps not the shiny new future that Oculus' idealistic Kickstarter backers envisaged, one where virtual reality is filled with malls and where Facebook is the gatekeeper to them.
What Zuckerberg's plan reminds me of most is Second Life, the virtual world that was briefly popular a few years back. That also tried to blend social interaction with corporate use; indeed, it became something of a corporate playground for a while before interest in it faded. Yes, you could even get the best seats at the tennis there too, and visit as many virtual shops as you liked. So far, so retro.
Does that mean Facebook's VR foray is destined to wither on the vine, like Second Life before it? Not entirely. Oculus could become Zuckerberg's Android if handled correctly. Google bought Android and turned it into the default smartphone operating system by making it open to all.
If Facebook wants to turn virtual reality into the next big thing, it needs to start thinking about the fruits of its latest purchase in a similarly ambitious way. That's because, even with Facebook's scale and muscle behind it, virtual reality won't be able to grow into the next big thing unless everyone wants to play.