Is Zuckerberg Nuts To Spend $2B on Oculus VR?

In a move that sparked one analyst to call CEO Mark Zuckerberg "nuts," Facebook is acquiring Oculus VR, the immersive virtual reality technology company. The price is about $2 billion, which includes $400 million in cash and 23.1 million shares of Facebook common stock.

Whether or not Zuckerberg is nuts, as Roger Kay, principal analyst at Endpoint Technologies Associates, insists, remains to be seen. One thing is certain: Oculus is developing as a heavy hitter in immersive virtual reality technology. The company has established plenty of interest among developers, having posted more than 75,000 development kit orders for the Oculus Rift, its virtual reality headset.

"Mobile is the platform of today, and now we're also getting ready for the platforms of tomorrow," Zuckerberg said. "Oculus has the chance to create the most social platform ever, and change the way we work, play and communicate."

Virtual's Role in Social Media

Zuckerberg seems utterly convinced. He must be, or he wouldn't be investing $2 billion in the company. The company announcement noted that several industries beyond gaming are experimenting with virtual reality technology. Facebook aims to extend the technology into some of those verticals, including communications, media and entertainment, and education.

The big picture for Facebook is that virtual reality technology is a strong candidate to emerge as the next social and communications platform. Brendan Iribe, co-founder and CEO of Oculus VR, certainly believes that.

"We believe virtual reality will be heavily defined by social experiences that connect people in magical, new ways," Iribe said in a statement. "It is a transformative and disruptive technology, that enables the world to experience the impossible, and it's only just the beginning."

We caught up with Greg sterling, principal analyst at Sterling Market Intelligence, to get his take on the mega-buy. He pointed out to us that Facebook called virtual reality...

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