Facebook Inks Deal Worth $2 Billion With Virtual Reality Company Oculus VR

Introduction

#Facebook has made some recent acquisitions in a quick succession much recently. Just weeks after announcing a $19bn deal for cross-platform instant messaging subscription service “WhatsApp”, Facebook has reached another agreement to purchase virtual reality company Oculus VR for $ 2 billion.

Benefits to Oculus

Facebook has paid $400 M in cash and more than 23 million Facebook shares, valued at $1.6B to Oculus. Additionally, the employees of Oculus will receive $300M provided the company achieves specific targets. Facebook will also help Oculus find ways to monetize its creations and push the Oculus Rift forward with software support.

Technology That Enticed FB – “Virtual Reality”

Virtual Reality technology isn’t a new thing. It witnessed a downturn back in mid-1990’s post failure of Nintendo’s Virtual Boy VR device.

What goes to the credit of US company “Oculus VR” is that it has been able to get people excited about VR again. Its virtual reality head-mounted display device has yet again made people excited about playing those 3D games and access immersive 3D virtual-reality experiences to the full. This device has an amazing wide field of view, high resolution display, ultra-low latency head tracking and much more.

Recent Mobile Acquisitions of #Facebook:

Oculus, a startup firm had not even shipped a single product to the consumers. In fact, except gaming developers, none in the business community has perhaps ever heard of the Oculus. It is only upon its acquisition by FB, its name has become well known.

Nevertheless, Oculus has done a good analysis of the market situation and of the potential of technology developed in-house. Then, it has negotiated with FB to close this deal. Patents and company’s intellectual property had played a role in this deal but partly, just as the case was with Facebook’s Whatsapp acquisition.

Nevertheless, Oculus VR’s founder, Palmer Luckey could foresee a wider future for VR and his ideas matched with Mark Zuckerberg’s. As a result, Facebook agreed to buy Oculus to take VR technology ahead for next-gen social and communications platform.

Facebook deserve applaud for visualizing the future, identifying an alluring technology as well as the gaps and white spaces in the technology area so that it maintains domination in the social and communication platform domain.

Info: Facebook’s Recent Acquisitions

Company AcquiredYearPurchase AmountPatents
Instagram12 April 2012$1billion
Whatsapp19 March 2014$19 billionUS2012294352
Oculus25 March 2014$ 2 billionUSD701206 S1

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