Zuck Makes Another Multi-Bil. Acquisition

Mark Zuckerberg announced Tuesday that Facebook has acquired Oculus VR, the manufacturers of the Oculus Rift virtual reality gaming headset, for roughly $2 billion. Zuckerberg said that Oculus Rift, which came to prominence as the most successful Kickstarter campaign in history, “has the chance to create the most social platform ever, and change the way we work, play and communicate.” It’s the second high-profile Facebook acquisition this month following the company’s $16 billion purchase of WhatsApp.

Oculus Rift, expected to be released in summer of 2014, is gaming a headset that aims to provide the type of virtual reality experience that the 1990s offered but — as purchasers of the ill-fated Virtual Boy can attest — never quite delivered. It functions as a box-like screen that straps to a player’s head that provides a video display of the gaming environment. More importantly, though, it tracks the movements of the player’s head, which allows them to “seamlessly look around the virtual world just as you would in real life,” according to the company website. Another flagship feature is its field of view, which stretches beyond a person’s peripheral vision and, in doing so, removes one of the biggest limitations of existing gaming devices (that is, the edge of the screen).

So, what business does Facebook have buying such a gaming-centric device? Zuckerberg’s statement didn’t make that clear, but presumably the goal goes beyond just letting you browse an immersive, 3-D version of Facebook, which actually sounds kind of terrible. While Zuck referred to OR as “a new communication platform” that would allow people to “share unbounded spaces and experiences” with one another, it’s also possible that he’s simply investing in a high-potential product.

Oculus Rift raised $2 million via Kickstarter in 2012, and went on to raise another $91 million in venture capital funding the next year. Facebook purchased Oculus VR for $400 million cash, plus 23.1 million shares of Facebook stock.