Facebook’s Oculus Buy Signals A Hardware Land Grab, And Company Fit Isn’t A Concern

Next Story

Facebook Stock Slides In After-Hours Trading Following Acquisition Of Oculus Rift

There’s a gold rush on, and the people striking it rich are the ones building things — not apps, not software, but honest-to-goodness hardware, like the Oculus Rift, whose creator, Oculus VR, was just purchased by Facebook for around $2 billion in cash and stock. Earlier today, Intel closed its purchase of wearable health tech maker BASIS, and Google recently bought Nest for $3.2 billion. Google is also said to be nosing around wearable device makers for another purchase, and everywhere you look, Internet companies are spending money on things, not just platforms or virtual experiences.

So what’s the story here? Does Facebook really care about immersive gaming technology, which, while exciting, is undoubtedly still something that excites the fringes and core gamers more than anyone else? And is Google really that interested in building thermostats and smoke detectors? The answer is probably not, but both companies are interested in the future of the web, and the future of the web doesn’t limit itself to apps on your smartphone or pages in your browser.

This seems odd when taken as a single data point on its own, but consider the contextual web that surrounds it: Google has acquired a number of robotics startups over the past couple of years, and it also recently purchased Motorola’s mobility division. It sold Motorola to Lenovo, but not before it extracted ATAP, a division that focuses on building advanced, connected next-gen hardware. Microsoft similarly picked up Nokia’s smartphone business, which means it, too, is expanding its hardware arsenal. Also, I’ve heard FB wasn’t Oculus VR’s only suitor.

On the Oculus side, the startup had made good progress and only recently announced its DK2 developer hardware, which is a step closer to a consumer product but isn’t quite there yet. Facebook’s offer seems to include stipulations that will see it continue its development of its virtual reality headset at Facebook, both for gaming and for “the most social platform ever,” according to a statement by Mark Zuckerberg, which will “change the way we work, play and communicate.”

While Zuckerberg seems to suggest FB is preparing for an immersive social-networking experience akin to a much more advanced Second Life taking place in a Star Trek holodeck, I’m more inclined to believe that this is part of a larger hardware land grab that doesn’t necessarily have a clear endpoint in mind.

Google and Facebook are much more competitors now than they ever have been in the past, and if one is making a big bet on connected devices as the future of the web, the other is sure to follow. People might want to seek out a more specific, complete motivation for this purchase, especially given the price tag. But it’s much more likely that these are bets made in advance to set the purchasing companies up for a game on a board that isn’t yet clearly defined, and that won’t take shape for at least another few years.