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Logic behind Facebook buying Oculus for 2 billion?

aguy10
Level 7

Surely you would think with that kind of money they could have just developed their own headset from scratch no?. What am I missing?.

7 REPLIES 7

M0rdresh
Level 4

The Oculus acquirement by Facebook dates back 7 years ago and now you want to debate it?

I just learned today about the 2 billion buyout. Does it matter how long ago it was?. Most people would be curious to know the answer if they're into tech. Also I wasnt interested in a debate. Just an answer.

M0rdresh
Level 4

Did not mean any offense. Like with any acquisition, why spend money on years of research and development AND, assuming that is fruitful, face fierce competition while you can acquire that immediately and eliminate competition in the same process. That's my take on it, while I do not necessarily support that business strategy (reducing competition) as a consumer, I can reason with it from other angles.

 

I was not a fan of Facebook acquiring Oculus at the time, but in retrospect I have to acknowledge the success of the Quest (2) and as an avid VR enthusiast ever since the Oculus DK1 I am convinced VR as a whole would not be where it is today without this acquisition. Especially the weight of a company like Facebook investing millions on VR and having introduced VR to a massive amount of people selling hardware at cost level or with a loss. We probably would not have seen this and faced far more stagnated progress if that did not come to pass. 

 

So in short, while most of us can have criticism at Facebook for other reasons beyond VR, but with VR (and looking at what the competition does) the continuation with Oculus ever since their acquisition is a job well done.  Nobody really knows what would have happened if they done what you said and develop their own thing and go head to head with Oculus. We can only guess.

aguy10
Level 7

That explanation makes sense to me. Especially the buying the competition out part.

DaftnDirect
Volunteer Moderator
Volunteer Moderator

I think it's the same reason Mercedes bought Brawn GP 11 years ago instead of starting their own F1 team from scratch, didn't they buy Ilmor too to become Mercedes AMG for the engines?

 

Buying companies (or buying a controlling share) can make a lot more sense than starting your own and hoping they make stuff that's as good.

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PITTCANNA
Level 13

Facbook wasn't buying a brand but an ip portfolio.  Ip protected from patent laws and other governening bodies.  

 

In short inside out tracking, and predictive motion and all the other innovations that come with the oculus brand is far more compelling then you think.

Zenbane
Level 15

@aguy10 wrote:

Surely you would think with that kind of money they could have just developed their own headset from scratch no?. What am I missing?.


If you build it from scratch, how do you avoid building something that infringes upon someone else's intellectual property?

 

HTC is a prime example. They tried building their own Inside-Out tracking headset to compete with the Quest, but the tracking accuracy was significantly worse than the Quest. HTC can't just "copy exactly" what Facebook implemented on the Quest (which is a combination of hardware via cameras and software via machine learning). The manner in which the Quest achieves its tracking is proprietary.

 

Besides, look at how much work Palmer and Carmack has put in to making the Oculus VR platform. Why not take advantage of their work instead of spending years (possibly decades) of trying to work from scratch?

 

When you want a new car, do you buy one that car specialized already made, or do you make one yourself? Etc.