SXSWorld
Issue link: https://sxsw.uberflip.com/i/317841
4 6 S X S W O R L D / M A Y 2 0 1 4 acebook's agreement in late March to acquire Oculus VR for $2 billion sent shockwaves through the Internet. Partly due to reac- tions to Kickstarter-funded companies selling for big bucks and partly because the move was so against the grain for Facebook, this acquisition felt different than Mark Zuckerberg's purchases of mobile apps Instagram and WhatsApp. For Facebook, the acquisition offers the potential for mass virtual communication, sporting event immersion and embedded movie and television experiences. However, many people excited about the Oculus Rift project wonder what will become of their gaming plat- form. e issue is especially raw for those who backed the Oculus Rift Kickstarter campaign in 2012. In his call to investors after announcing the deal, Zuckerberg positioned the move by stating that Facebook felt strong enough in its mobile presence to start moving forward with new avenues of distribu- tion. Back in the day, mobile was a big question for Facebook. Zuckerberg, however, pointed out that one bil- lion people now actively use Facebook services on mobile platforms and that "more than 20 percent of the time that people spend in apps on mobile phones is using Facebook services." Many of those numbers came from the acquisitions of Instagram and WhatsApp. So Facebook wants new worlds to conquer, whether Internet producing drones or with VR consoles, which is where Oculus VR comes in. e Oculus Rift headset has received plenty of solid press. It also has an intriguing history given that the project was partially funded through that now famous Kickstarter campaign, which raised $2.4 million from 9,522 backers. Can Oculus VR stay true to its customers? In the aforementioned call to investors, Zuckerberg didn't equivo - cate on the immediate future of Oculus VR stating, "We're going to focus on helping Oculus build out their product and develop partner- ships to support more games and accelerate their plans. And they'll continue operating independently within Facebook to do this." e important parts for Oculus Rift fans come in the form of stated support for a "games first" focus and a commitment to inde- pendent operation. While some of Oculus' Kickstarter backers have concerns about Facebook, the current goals for both companies remain Oculus' original vision and sufficient autonomy to stick with that vision. Now in a world where console gaming platforms have fairly stable product lines, can Oculus Rift really promise to match the Xbox or PlayStation in longevity? at remains to be seen. What do companies owe their Kickstarter supporters? While neither company wanted to talk long term plans, another Kickstarter-funded gaming company discussed its views on what obligations these companies have in supporting backer interests after the project is funded. Ryan Scott Dancey of Goblinworks ran a successful $1 million Kickstarter campaign to fund the fantasy MMO (massively mul- tiplayer online) game Pathfinder Online. While Dancey says that companies technically owe only what is promised in the rewards description of that campaign, he does believe certain deeper obliga- tions exist. "I think they owe backers a fairly detailed description of how the money was spent," he explains. "I think they owe regular updates on the project—both good and bad—until it is delivered. I think they owe a place for backers to provide their comments and for a two-way conversation to take place. In other words, I think they owe backers a fairly high degree of transparency." Oculus VR appears to be ful- filling most of those conditions. Oculus has two posts on its Kickstarter update blog since the announcement with Facebook. While the reaction to the pur- chase has been both mixed and passionate, Oculus has remained mostly committed to the Kickstarter communication channel. e extent to which the deal meets the goal of transpar- ency seems a bit of debate among the company's backers. What's the end game? is is the billion dollar(s) question, and no one knows for certain. When approached about future strategies for either company, Facebook offered a firm and clear "no comment." Oculus VR also was slow to respond to inter- view requests. is leaves a lot of tea leaves floating in the murky mix of Rift gaming consoles, Kickstarter backlash and Facebook business savvy. e logical principle of Occam's razor, which roughly states that we shouldn't make more assumptions than the minimum needed, sug- gests that taking Zuckerberg at his word makes for the closest shave. Zuckerberg wants a robust VR platform, but he is not planning to slice up Oculus' initial plan. Oculus Rift will start as a gaming plat- form, but all that new talent will certainly start exploring ways to expand the VR experience. Microsoft bought Skype for four times what Facebook agreed to pay for Oculus VR. If Oculus turns out to be half the communi- cations platform Zuckerberg envisions, then gaming will become a smaller part of the pie but a key early part nonetheless. It could also be one amazing steal of an acquisition. n Michael Trice is a lecturer in writing and communication at the Massachusetts Institute of Technology. Examining the Implications of Facebook's Oculus VR Acquisition by Michael Trice Oculus Rift in use at SXSW Gaming Expo D E B B I E F I N L E Y F