Hacker News Reader

Comment by jfoster | Hacker News Reader

I think it's a combination of factors.

I don't think many investors are familiar with Oculus VR. To them, facebook has just paid $2B for a company that hasn't released a product to consumers yet, and intends to make one of those headsets that were a big flop in the 1990s.

The other side of it (as you point out) is that institutional investors are generally not in it for long-term gains. If you manage a portfolio at an investment company, are hoping to get a nice bonus this year/quarter, hearing Mark Zuckerberg say he's bought a company that might take 5 - 10 years before it adds anything to Facebook is probably not very impressive.

View on HN

you are right but for value investors, I think that Oculus Rift could have a quite a big impact on the intrinsic value of Facebook, now the risk is, can they get it right? A non-gaming company getting into 3d virtual reality? Clearly, Google (actual experience of making hardware) doesn't think the timing is ripe yet.

What we have with Oculus Rift is that they were spooked by Sony, and decided to cash out while they still could.

VR will be a major major step for Sony if they get it right (which they are likely to do so) with PS4. They would absolutely own this space with their experience in 3d entertainment hardware.

Sony has one major disadvantage: they are tied up to the ps4 while PC's which are more powerful/upgradable are a better fit for VR.

There's rumors microsoft is working on VR. They also have an amazing 3d game creation platform for beginners called "project spark", very good at building developer communities a and would be happy to sell more PC's. Assuming they can create decent VR glasses, they seems to have the winning combination of hardware + content.

Even better - project spark content would be free, which is a powerful tool to achieve mass appeal.

They could always just do what Microsoft did with the first Xbox. There is nothing stopping them from putting a PC in a fancy box if that is a better product (VR versus no VR) than what they would otherwise do for the PS5.

I agree. If facebook were sticking to the web/mobile, their value as a company would be a bit limited, and there would always be the possibility that they will eventually be disrupted in the same way that they disrupted MySpace.

Zuckerberg yesterday was talking about building new computing platforms. That doesn't necessarily increase the value of Facebook, but it takes away a lot of the caps that would otherwise exist on their future valuation. Now no one knows how much they might be worth in 5 - 10 years.

Reply on news.ycombinator.com