Oculus VR | Facebook post

4 minutes estimated reading time

At the time that the news came out about Facebook’s acquisition of Oculus VR, I was in Boston (for work), the weather was biting cold, the days long and jet lag dulled my curiosity; so this post came along later than I would have liked.

The first thing that struck me was how much of the content that I had posted about the Facebook IPO and the recent WhatsApp acquisition seem to fit the Oculus acquisition as well.

How it fits into the the broader Facebook acquisition pattern
When looking at the Facebook IPO I commented that Facebook needed to look at other markets beyond online advertising whilst leveraging its existing customer base. I also made the comparison of Facebook and Xerox; in terms of its existing form being a cash generator to fund some future big bet:

I personally think that if you buy into Facebook’s future promise, Facebook looks more like Xerox. In the 1950s, the Northeastern US was the Silicon Valley of its day; with engineering and chemical factories around New Jersey and the Boston corridor through to New York being the home of the infant computer industry. Xerox was founded as a photographic supplies company that made equipment to develop photographic film, it eventually incubated its killer product –  xerography  which begat photocopiers and fax machines after a decades worth of work. Later on in the development period, the company invested in an insurance company to provide cash flow for future model developments. If you believe that Facebook has a bright future ahead of it, then by implication, it’s current and immediate future products like premium ads in the news feed look more like cash generative businesses to fund ‘project X’ whatever that turns out to be.

What Oculus VR, Whatsapp and Instagram represent is a spread bet on what the future is likely to be based on a few different approaches; mobile devices are important, as are lean bandwidth applications that perform well on less developed mobile networks and finally that the immersive experiences promised us by cyberpunk literature will happen .

Given that Facebook has about 100 billion dollars or so to play with it could do another two dozen such bets on the future. Oculus VR technology isn’t likely to win out when Chinese, Korean and Japanese consumer electronics brands invade the sector and bring the kind of hyper-competition that translates into razor-thin hardware margins; so the model must have some licensibility in the business model.

Google Glass is not the glasses that you are looking for
The second thing that struck me was that Facebook’s endorsement of Oculus could be viewed as a tacit acknowledgement by Facebook that Google Glass is going in the wrong direction at the moment. Oculus Rift provides an ‘in the line of sight’ view of content rather than a ‘glance up’ orientation. However Sony’s Smarteyeglass seem to be ahead of the curve on this. There is more speculation that Facebook want’s to roll out a cyberspace view of the internet promised in cyberpunk literature; however there would be a lot of work that would be needed to be done on standards and conceptual web design in order to move this idea forwards significantly.

A break in faith
The outpouring of outrage by Kickstarter fans who helped fund Oculus VR is perhaps the most interesting aspect of all this. Early adopters are often upset when their little secret becomes mainstream. It is familiar to me from club culture.

Ibiza is not like it used to be… The atmosphere went when moved from to and the crowd changed…

The implication for Kickstarter is that it will be much harder to get funding for seriously innovative tech-related projects and Oculus will have poisoned the well. Kickstarter will still work for artists looking to release albums or small short film projects and will do so very well, but it will have had its potential clipped.

More information
The Facebook IPO Post (I)
The Facebook IPO Post (II)
WhatsApp | Crunchbase Profile
Why Facebook is a dead man walking
Why Facebook is a dead man walking part II?
Why Facebook is a dead man walking part 2.5?
Facebook and advertising or why Facebook is a dead man walking part III?
Facebook: IPO postmortem – a dispassionate analysis
The Facebook | Instagram post
The WhatsApp | Facebook post (part I)
The WhatsApp | Facebook post (part II)
This isn’t the vivid cyberspace that I signed up for…
The Google Glass post
Eight trends: Immersive as well as interactive experiences
Oculus Rift Brings Virtual Reality to Verge of the Mainstream | MIT Technology Review
Why Oculus’s $2bn sale to Facebook sparks fury from Kickstarter funders | Guardian
What does the Facebook Oculus deal mean for Kickstarter? | CNet