Innovation
Facebook to acquire virtual reality firm Oculus for $2bn; It has no customers
By Finfacts Team
Mar 26, 2014 - 9:28 AM

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Facebook announced Tuesday that it has agreed to buy virtual reality headset maker Oculus VR for $2bn in cash and stock. “There are not that many companies building technologies that can be the next major computer platform,” said Mark Zuckerberg, Facebook co-founder, in a conference call with investors. “We are making a long-term bet that immersive virtual reality will be a part of people’s lives.” Oculus VR has yet to sell its products in the market.

The deal is comprises $400m in cash and 23.1m shares of Facebook stock.

 "Oculus's mission is to enable you to experience the impossible. Their technology opens up the possibility of completely new kinds of experiences," Zuckerberg added. "Immersive gaming will be the first, and Oculus already has big plans here that won't be changing and we hope to accelerate."

Oculus's headset, called Rift, today is a visual device for playing videogames.

The Wall Street Journal says that unlike WhatsApp, which has 450m users, Oculus isn't yet available to consumers, and the company hasn't said when it will be available. It currently sells prototype units to developers for $350.

Bloomberg News reports that Spark Capital invested in Oculus VR Inc. in June after the firm’s partners bought the company’s virtual-reality goggles online. The bet ended in a 20-fold gain following Facebook’s agreement yesterday to buy Oculus for as much as $2.3bn, said people with knowledge of the deal.

Spark and Matrix Partners each invested about $19m in Oculus in two rounds last year, first in June then in December, said the people, who asked not to be identified because the figures weren’t disclosed. The venture capital firms’ stakes are now worth about $380m each, they said.

Zuckerberg's statement on Facebook

"I'm excited to announce that we've agreed to acquire Oculus VR, the leader in virtual reality technology.

Our mission is to make the world more open and connected. For the past few years, this has mostly meant building mobile apps that help you share with the people you care about. We have a lot more to do on mobile, but at this point we feel we're in a position where we can start focusing on what platforms will come next to enable even more useful, entertaining and personal experiences.

This is where Oculus comes in. They build virtual reality technology, like the Oculus Rift headset. When you put it on, you enter a completely immersive computer-generated environment, like a game or a movie scene or a place far away. The incredible thing about the technology is that you feel like you're actually present in another place with other people. People who try it say it's different from anything they've ever experienced in their lives.

Oculus's mission is to enable you to experience the impossible. Their technology opens up the possibility of completely new kinds of experiences.

Immersive gaming will be the first, and Oculus already has big plans here that won't be changing and we hope to accelerate. The Rift is highly anticipated by the gaming community, and there's a lot of interest from developers in building for this platform. We're going to focus on helping Oculus build out their product and develop partnerships to support more games. Oculus will continue operating independently within Facebook to achieve this.

But this is just the start. 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.

These are just some of the potential uses. By working with developers and partners across the industry, together we can build many more. One day, we believe this kind of immersive, augmented reality will become a part of daily life for billions of people.

Virtual reality was once the dream of science fiction. But the internet was also once a dream, and so were computers and smartphones. The future is coming and we have a chance to build it together. I can't wait to start working with the whole team at Oculus to bring this future to the world, and to unlock new worlds for all of us."

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