Facebook to acquire virtual reality firm Oculus VR for $2B in cash and stock
Social media monolith Facebook is said to prepping another huge acquisition, this time setting its sights on Oculus VR, the virtual reality hardware and software firm responsible for the Oculus Rift.
Less than one week after announcing a second-generation Oculus Rift development kit, the virtual reality company has revealed it will be purchased by Facebook for some $2 billion in cash and stock. The news was first tweeted by Bloomberg.
"Mobile is the platform of today, and now we're also getting ready for the platforms of tomorrow," said Facebook CEO Mark Zuckerberg. "Oculus has the chance to create the most social platform ever, and change the way we work, play and communicate."
According to a press release issued by Facebook, the company is paying for Oculus with $400 million in cash and 23.1 million shares of Facebook common stock. The deal is expected to be finalized by the second quarter of 2014.
Under the terms of the agreement, Oculus will continue operations from its headquarters in Irvine, Calif., including work on the latest iteration of its Oculus Rift platform.
The sale comes as a surprise to many, especially given the buzz around Oculus' hardware offerings. The Oculus Rift created a stir in the gaming industry when it was introduced on Kickstarter in 2012. After a hugely successful funding round, the startup went on to raise nearly $100 million in venture capital financing.
With Facebook's infusion of cash and resources, Oculus may be in a better position to accelerate a market date for the Rift, which is still in beta testing.
The Oculus acquisition could mark the start of a Facebook buying spree, as the company just last month purchased popular messaging app WhatsApp for $16 billion plus $3 billion in restricted stock units.
"This partnership is one of the most important moments for virtual reality: it gives us the best shot at truly changing the world," said Oculus founder Palmer Luckey in a prepared statement. "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."
Less than one week after announcing a second-generation Oculus Rift development kit, the virtual reality company has revealed it will be purchased by Facebook for some $2 billion in cash and stock. The news was first tweeted by Bloomberg.
"Mobile is the platform of today, and now we're also getting ready for the platforms of tomorrow," said Facebook CEO Mark Zuckerberg. "Oculus has the chance to create the most social platform ever, and change the way we work, play and communicate."
According to a press release issued by Facebook, the company is paying for Oculus with $400 million in cash and 23.1 million shares of Facebook common stock. The deal is expected to be finalized by the second quarter of 2014.
Under the terms of the agreement, Oculus will continue operations from its headquarters in Irvine, Calif., including work on the latest iteration of its Oculus Rift platform.
The sale comes as a surprise to many, especially given the buzz around Oculus' hardware offerings. The Oculus Rift created a stir in the gaming industry when it was introduced on Kickstarter in 2012. After a hugely successful funding round, the startup went on to raise nearly $100 million in venture capital financing.
With Facebook's infusion of cash and resources, Oculus may be in a better position to accelerate a market date for the Rift, which is still in beta testing.
The Oculus acquisition could mark the start of a Facebook buying spree, as the company just last month purchased popular messaging app WhatsApp for $16 billion plus $3 billion in restricted stock units.
"This partnership is one of the most important moments for virtual reality: it gives us the best shot at truly changing the world," said Oculus founder Palmer Luckey in a prepared statement. "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."
Comments
Oh good God. Go away Facebook. Systematically ruing the world they are.
What the...??? What a bizarre acquisition. It's amazing how many billions these companies can throw around.
I'm sure Facebook and Google dream of a world where we walk around wearing their goggles/glasses that bombard us with "personalized" advertising everywhere we go. It's like a dreary sci-fi movie come true.
I'm not taking part in that world.
I'm not seeing how virtual reality fits into social connection.
"Oculus has the chance to create the most social platform ever, and change the way we work, play and communicate."
When someone wears the goggles, they can't even broadcast their face to the other person. You can't type either because you can't see the keys. Maybe the following video shows what they'll get to eventually (nsfw) but it's a while away:
These purchases seem to be more and more the result you get from a 29 year old having tens of billions of dollars to blow on whatever he feels like. Here's the justification:
http://www.businessinsider.com.au/zuckerberg-why-facebook-bought-oculus-2014-3
"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.
This is really a new communication platform. By feeling truly present, you can share unbounded spaces and experiences with the people in your life. Imagine sharing not just moments with your friends online, but entire experiences and adventures."
Imagine the possibilities.
Patient on VR: doc, I have this weird growth can you take a look at it
Doc: ok just remove your underwear and point the camera down
Patient: did I just hear a crowd groaning?
Doc: yeah, I have all my Facebook followers watching
I literally shouted "no!" out loud when I read this.
Faceboom is turning into Google...
I don't see how a Facebook account could be involved/required anyway, so I'm not too worried. The Rift is hardware, with support from gaming middleware (Unity, Unreal, etc.). I don't see how that basic situation could change much. Are they going to make Portal 2 require a Facebook login to play in VR? Of course not.
If Facebook wants to make some VR social platform (next-gen Second Life?) well... go nuts. That's NOT what I want to do with VR myself, but no harm in trying. Games and education will engage more people I'm sure. (Or maybe a VR social gaming hub, where you're in an avatar-based lobby BEFORE you play games? Ugh--just give me a menu. Still not interested.)
Eventually I see the Rift being completely standalone: a console IN a headset, that runs its own titles (since titles must be prepped for Rift anyway). Base it on some custom Android fork or whatever... I don't care... just as long as cuts the tether and supports the major game engines.
(Connecting it to a phone makes less sense: you still have a cord then, and this kind of 3D would burn battery life like mad. Wireless video? Lag is a killer for VR. Better to put the processor ON the goggles... eventually.)
In the meantime, it's a terrific PC/Mac peripheral. The dev kit is amazing, and I can't wait for the 1080p consumer edition.
Evidently Facebook sees more of a future in gaming than in posting idiotic pictures?
It's amazing how many billions these companies can throw around.
I know. I was just reading the other thread to learn that Luxottica bought Oakley. I said wow, I did not know that, so I looked it up and it happened back in 2007 for guess how much? $2 billion. I know that was a while ago, but there hasn't been so much inflation that would make Occulus worth that much. At least Oakley makes stuff that everyone wants.
I'd like an explanation. SnapChat, even though something I'd think FB could do in their sleep, is at least in the same wheelhouse. I don't see how FB pages and VR fit together.
Careful what you wish for.
I am sorry for your loss.
Sincerely,
Me