Facebook’s latest venture is a buyout of another company, Oculus VR, a company that makes virtual reality headsets. The deal will cost Facebook $2 billion, comprised of $400 million in cash and $1.6 billion in stock.
Facebook grabbed widespread attention last month when it acquired Whatsapp for $19 billion. The buying spree continues with the purchase of Oculus VR, but this time around, some are skeptical that the acquisition will not do much at all to improve Facebook’s business. The idea of a 3-D experience in social media just isn’t sitting well with critics, many of whom do not see how this marriage will benefit either party.
“Is it too early to declare that Zuckerberg has ambitions to become the Warren Buffett of technology? Look at his big purchases — Instagram, WhatsApp, Oculus. None of them are likely to be integrated into the core Facebook product any time soon; none of them really make it better in any visible way”, says Felix Salmon at Reuters.
Oculus is a small company by Silicon Valley measures and many might be surprised to learn that it started via a Kickstarter campaign. It focused its efforts on technology that would enhance video games and make them more appealing to die- hard video junkies. The company has seen some success, but its founders had to be a little surprised when Facebook came knocking on the door.
Facebook CEO Mark Zuckerberg has defended the move, saying that the deal reflects his opinion that virtual reality is an up-and-coming medium and could easily become one of the “platforms of tomorrow.” But he is still having a hard time convincing critics that this was a smart move, and that includes those who supported Facebook’s previous acquisitions.
Whether Facebook’s buyout of Oculus proves financially lucrative to the social media giant won’t be known for some time. But if it does, then who knows what the future may bring? Simple messages to friends and family on a screen could be enhanced with actual headset images, including live, real-time action. It will be up to Mark Zuckerberg & Co. to make the possibilities reality and prove the critics wrong.
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