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Facebook Buys Oculus VR for $2 Billion, and There is Wailing and Gnashing of Teeth

I know Facebook took in an ungodly amount of money from going public. I don’t have the exact numbers, but I know it’s a whole bunch. But, after Facebook’s third billion-dollar acquisition since 2012 in Oculus VR, the hottest virtual reality game in town, to the tune of $2 billion, at what point do we start wondering just how much money Facebook actually has, and how deals this massive can possibly pay off in the rough and tumble, ever-changing tech industry? That’s worth ruminating on, but more importantly, it has to be said that this might just be the saddest acquisition story of all time.

Since the release of the Nintendo Wii, and bolstered by the advent of mobile and Facebook games, there’s been a palpable tension between, for lack of better terms, ‘core gamers’ and ‘casual gamers.’ These labels aren’t satisfying—the distinction between the two is muddled at best. But, there is something real to the distinction, and it’s based in deep feelings of identity and community among so-called ‘core gamers.’

In the ’80s and ’90s, video games were a niche hobby. Practically everyone who played video games at that time was the butt of a joke at some point during their childhood. Being in a small crowd that draws a certain level of external derision causes a sense of community to crop up pretty quickly—you can see it in gaming forums from that time, and in competitive games like Quake, which enjoyed active, passionate, tight-knit fan bases. Compare that to today, where video gaming is very much a mainstream attraction. Video gaming has lost the stigma that allowed it to be the core of a shared identity in the first place.

For that core gaming community, ‘social gaming,’ and even annual bestsellers like the Call of Duty series, aren’t just minor market annoyances—they’re seen as an existential threat that is only strengthened by the suspicion that more and more game developers will abandon the traditional gamers to attract the mainstream, leaving those core gamers bereft of games made with their interests at heart. Now, their best hope for the future of gaming, on their terms, is owned by a company with no expertise in gaming. Yeah, there’s going to be outrage.

It’s textbook selling out—turning back on the people that made you famous, and hitting the big time. You can’t blame Oculus VR for going that route—$2 billion is, to say the least, compelling—but it’s hard not to feel bad for those left behind. And it’s worth saying—there are no absolutes. Some traditional gamers love them some Call of Duty. But, a lot don’t, and a lot of the ones who don’t invested heavily in Oculus Rift, emotionally and financially.

Oculus Rift was supposed to be different. Technology had progressed enough to make real, beautiful, immersive virtual reality possible. Oculus VR proved that to be true with incredibly popular and hyped demonstrations and development kits. And the best part, for that core crowd, was that it was theirs. It was a Kickstarter-backed, community-driven labor of love for all involved. Millions of dollars were willingly given to a project that was, finally, made just for them, by people the community thought were right alongside them. The project progressed, and it looked like a dream come true, in the most literal sense—a dream world, in virtual space. Their world.

Then, Oculus VR took their millions and sold themselves to Facebook for a breathtaking windfall, of which those passionate Kickstarter backers will not see one cent. Everyone’s heard the warnings about Kickstarter by now—you’re donating money, you have to know you might not get what you want out of it, you’re not a real investor. I think everyone involved gets that. But, there’s a notional trust that goes into a project like this—again, a sense of community. There was a notion that visions and goals between creators and community were aligned. It’s hard to argue that the community wasn’t hoodwinked—especially galling considering they provided the start-up cash.

A lot of people are making fun of the gamer outcry that has exploded since this announcement, but can you blame them? Needless to say, Facebook and its dubious privacy history is not the least bit popular with the ‘core gaming’ crowd, one that’s already suspicious of Facebook because of its ties with ‘social gaming’ in the first place. Oculus VR owned by Facebook is, literally, anathema to vast swathes of those Kickstarter backers. It’s not part of their identity.

Regardless of whether or not Facebook ‘ruins’ Oculus Rift, which is debatable to the point of meaninglessness, it’s a sad day for a community of gamers that still very much wants to think of themselves as a community. Maybe you have mixed feelings about that kind of exclusionary thinking, but they don’t, and they wanted something that was theirs. Oculus Rift is now in the hands of one of the wealthiest, most powerful publicly traded mega-corporations in the world. It’s not theirs anymore. Seeing John Carmack, co-creator of id and a central figure in developing old classics like Doom and Quake, tweet about technical scale and a deep respect for what Facebook does, only serves to twist the knife.

And that community’s fears—fears of how Facebook will ‘change’ Oculus Rift—are entirely defensible. Facebook is publicly traded—it serves shareholders, not gamers. Facebook makes its money by data mining and advertising revenue—its customers are advertisers, not gamers. The usual promises, of course, have already been made. Zuckerberg’s announcement already has the trademark bit about leaving Oculus VR alone and letting them do their thing, and Oculus VR founder Palmer Luckey has already dropped ‘Facebook is run in an open way that’s aligned with Oculus’ culture.’ And in the near term, that will surely be true (although many will scoff at the idea of Facebook being ‘run in an open way’).

But, does anyone really believe that will be true two, three years from now? Facebook answers to shareholders. Those shareholders are going to want a return on investment sooner or later, and my money’s on the former. As always, there will at some point be a clash between the original vision of the acquired talent and the demands of shareholders. I don’t need to tell you who’s going to win that fight. Gamers will point to what EA did with the SimCity franchise, and they won’t be wrong to draw the parallel. Gamers have emotional attachments to classic franchises and classic historical figures like Carmack—it hurts when those things get wrested away from you and transformed into something else, for someone else. This is what it looks like when niche ideas move to the center, even if only in the realm of perception.

And make no mistake, Facebook will use Oculus Rift to mine data and sell (and distribute) ads, as many fear. Here’s Mark Zuckerberg, during an internal conference call shortly after the announcement:

…we’re clearly not a hardware company. We’re not gonna try and make a profit off the devices long term. We view this as a software and services thing, where if we can make it so that this becomes a network where people can be communicating, and buying things and virtual goods, there might be advertising in the world but we need to figure that out down the line, then that’s probably where the business will come from if I have to say. (emphasis added)

Might? No one believes that, down the line, Facebook is going to leave advertising revenue on the table. That’s not to say that those ads will be necessarily intrusive, but it is saying that the privacy fears that make many people uncomfortable with Facebook will loom large over the Oculus Rift. Facebook didn’t spend $2 billion just for kicks.

Those fears aren’t just going to drive gamers away, either. Markus Persson, better known as Notch, is the creator of Minecraft and the owner of Mojang. After the announcement of the acquisition of Oculus VR, Notch promptly took to his blog, stating in no uncertain terms that a deal to officially bring Minecraft to the Oculus Rift is off the table. He echoed the fears of many gamers who were equally incensed—

Facebook is not a company of grass-roots tech enthusiasts. Facebook is not a game tech company. Facebook has a history of caring about building user numbers, and nothing but building user numbers. People have made games for Facebook platforms before, and while it worked great for a while, they were stuck in a very unfortunate position when Facebook eventually changed the platform to better fit the social experience they were trying to build.

Notch goes on to talk about not wanting to work with Facebook, calling them creepy (he’s not the first), and that, in a key, seemingly very representative statement (with varying dollar values), stating ‘…I did not chip in ten grand to seed a first investment round to build value for a Facebook acquisition.

Considering what Oculus Rift appeared to be in the beginning—an open source, independent frontier for video games, made for gamers by gamers, that seems like a pretty fair complaint. It’s also proof positive that there are tangible consequences to gamers as a result of Oculus VR being acquired by Facebook. Some of the same beloved developers who are part of that tight-knit gaming community will, like Notch, also jump ship, and again, who can blame them? To develop for Oculus Rift, you’re going to have to play by Facebook’s rules. If that’s not true now, it will be—Notch already cited Facebook’s notoriously fluid gaming platform as a strong indication of that.

This isn’t to say that Facebook’s purchase of Oculus VR is an objectively ‘bad’ thing. Zuckerberg, in his post announcing the acquisition, mentioned part of his vision for the Rift, including virtual doctor visits and seeing a basketball game from courtside seats, just by sitting at home and popping the Rift on. A lot of people are really going to enjoy those uses—even Notch, in his statement, tips his cap to them—and yes, those uses wouldn’t be possible without Facebook’s money. But, therein lies the problem—Oculus Rift belongs to Zuckerberg’s vision now. Some people might like that social, interconnected vision, and they’re not wrong to. But for the bulk of the people who supported Oculus VR with their money from the very beginning, it’s a sad reminder that everyone has a price, and that the mega-corporation is becoming harder and harder to resist.

Some people just want to swim in smaller streams—unfortunately for them, streams have a nasty habit of flowing into rivers.

UPDATE: Here’s Oculus VR’s version of the acquisition announcement, per their blog.