The Oculus VR team. Image credit: Oculus VR
With Sony PlayStation and Electronic Arts showing huge interests in virtual reality technology, it’s only a matter of time until another game-publishing platform announces its own newfangled ideas for the concept. Or in social network site Facebook’s case, do the next best thing and buy off the company that has already made its rounds in spreading the VR gospel.
According to an official announcement, Facebook will be acquiring VR headset-making company Oculus VR for US$2 billion. This includes US$400 million in cash and 23.1 million shares of stock valued at a total of US$1.6 billion. If Oculus VR hit certain milestones, the company gets an additional US$300 million earn-out in cash and stock. The company will still be based in Irvine, California.
The social media bigwig plans are twofold: to expand the Oculus Rift’s uses to broad fields like media, entertainment, communications and education, as well as speed up the company’s growth in the gaming space. Facebook CEO and Founder Mark Zuckerberg said that this decision is prepping the company for the platforms of tomorrow. “Oculus has the chance to create the most social platform ever, and change the way we work, play and communicate,” said Zuckerberg.
Oculus VR CEO Brendan Iribe said that the tech will be heavily defined by social experiences that connect people in new ways. “It is a transformative and disruptive technology, that enables the world to experience the impossible, and it’s only just the beginning,” stated Iribe.
How did this all happen and out of the blue to boot? According to the Oculus VR blog post, the company met up with Facebook a few months ago to talk about working together and bringing VR tech to millions of people. “We’re culturally aligned with a focus on innovating and hiring the best and brightest,” the company stated on the same post. “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,” it further stated.
“It gives us the best shot at truly changing the world. It opens doors to new opportunities and partnerships, reduces risk on the manufacturing and work capital side, allows us to publish more made-for-VR content and lets us focus on what we do best: solving hard engineering challenges and delivering the future of VR,” added the post.
The acquisition will provide major benefits that will make the team create a better virtual reality product, obviously from a financial perspective. The deal will close during the second quarter of 2014. With this and the WhatsApp purchase for US$19 billion, who knows what insane purchases the social platform will go to next?
Though this may irk some hardcore gamers as Facebook is more known for free-to-play timesinks like Farmville, they have to concede that this is one great move for Oculus VR to push its headsets beyond the gaming crowd. Besides, Zuckerberg said himself that Oculus’ gaming plans will not be changing due to the buyout. “There’s a lot of interest from developers in building for this platform,” he said. “We’re going to focus on helping Oculus build out its product and develop partnerships to support more games. Oculus will continue operating independently within Facebook to achieve this,” said Zuckerberg.