Oculus, Facebook, and the Metaverse

Startups are to San Francisco as sports is to the rest of America: we speculate about acquisitions like it's the NBA draft, ogle billion-dollar exits like southern californians watch E!, and substitute the latest launch or pivot into conversation where others would be talking about the game last night.

In January it was Nest, last month was WhatsApp, and now everyone's aflutter about this Oculus Rift thing.

Oculus is really cool. I've been on a minimalism kick for a bit, and the idea that a single device could replace a huge home theater really appeals to me– rather than buy an 80-inch TV and huge speakers, a five-inch screen is just as good if it's an inch from your retinas. I'm also a sucker for Neal Stephenson, and the Metaverse is probably a ways off, this is a big step in that direction. We might even get some benefits in the SF housing crunch, as people realize that they can do just fine with a 300 ft^2 home when they have an endless virtual world to escape to.

I was a little surprised when Facebook announced their acquisition, especially because Oculus started as a gaming project, and Facebook really hasn't ever done anything in that space. But I wasn't worried until I read this article:

Let's suppose all these other problems are overcome and there are hundreds of millions of people spending significant fractions of their waking lives in the Metaverse. Now FB knows where you go, how frequently you go there, what you look at during the day (do you think girl model A or girl model B is hotter becomes an answerable question for eager marketers) and so on and so forth, and now all your small daily interaction in the real world, become monitored and collected data in the virtual world — which the marketing staff can mine. Given FB's privacy problems in the past, is this really an organization you want to have information at this level of detail?

In theory, VR can be just as immersive as the real world. But unlike the real world, you'll leave a digital trail along with every single activity, every glance, move of the hand, every tiny twitch will be open for data miners to search, collate and exploit. If you think knowing where your phone is has privacy ramifications, what about this level of detail?

Some hypothetical terms of service where this isn't allowed protects you? What stops FB from just changing the terms without your knowledge because your life isn't as easy to monetize as Facebook would like?

Maybe I'm just naive, but the privacy issues aren't all that troubling to me. While they've had some flubs in communication around privacy settings, Facebook actually does a pretty admirable job of giving users control over who sees what. I have close friends, acquaintances, family, and even former students as Facebook friends, and I can't think of any other social network or situation where I'd be able to comfortably connect to that many groups on the same social graph. And as for the ad targeting, FB ads are consistently better than anyone else's in terms of actually piquing my interest and showing me products I'm interested in. Ads are the price we pay for the social graph, and it's a lovely world we live in where a few blobs of text on the right margin of the screen are our biggest problem.

And as for the profit motive…

Carmack and Abrash want to make the Metaverse because it's a very old and very cool dream. Zuckerberg wants to make the Metaverse because of the tremendous money making opportunities it creates. Imagine an entire universe you control and can endless plumb for dollars.

Facebook knows large-scale social interaction, and I trust them to do something cool with it. It might start simple– virtual video hangouts and scrolling around panoramic photos– but I can see them merging the worlds of social media and social gaming, letting you see which of your friends are playing Eve:Valkrie, and then jumping right into a firefight next to them. So you may pay for the privilege? Same with Microsoft, Valve, Blizzard, Netflix, and every other cloud gaming and entertainment company. Facebook makes their money on creating an engaging, dopamine-driven 'third place' for a billion-plus users, and you can trust their shareholders to want that trend to continue.

But we get no guarantees:

Oculus can give us their word, swear an oath, and cross their hearts. But their destiny is no longer in Palmer's, your's or Michael's hands. It's in Mark Zuckerberg's. And if there is, at any point, any sort of disagreement over the smallest issue, there will be no debate because the Oculus team are now nothing more than employees, and will have to put up or shut up when it comes to crucial decisions.

This argument resonates more. My fear isn't Facebook's metaverse– it's that there won't be an alternative. My fear is that when it finally ships, the Facebook-owned Oculus will be locked down with DRM, and the gaming and open-source community will never get a chance to innovate with the platform. No non-DRM'd media, no distributed, encrypted virtual universe, no open-source games. No copyright-violating Star Wars virtual worlds, no Parrot AR drone controllers.

I could be wrong, and I hope I am. Facebook might give the hardware team their space, and leave developers and users alone when they're outside of the Facebook app. They could go the Android or Mac software route, selling blessed games through an official app store but still permitting side-loading whatever content you'd like. They'd make money on the hardware sales, app store, and advertising, and let alone the couple percent of their user base obsessed with privacy and DIY.

But the project could easily be corrupted. M-rated games could be banned. Everything could be a farmville clone. Loading pages could be peppered with Facebook ads. I'd like to think that FB is smarter than that, but it could happen.

Thankfully, a shitty Facebook Oculus is not the end of the world.

Oculus did a lot of the hard work of marketing and branding VR, and some of the technical work around the motion tracking, but a lot of the success is just being in the right place to capitalize on innovations in other areas:

  • Screen resolution: we finally have cheap, high-definition LCDs and OLEDs that can output 60hz+ and avoid the tearing that used to destroy the VR experience.
  • Video cards: whether desktop or console, gaming hardware performance has been at insane levels for a few years now, and mobile is rapidly approaching the same place.

Head-mounted displays are not new. Positional tracking is not new. The technology for VR exists now, and bleeding-edge 1440p OLEDs will be commodity hardware by the time the consumer version ships.  You might not be able to build something as light or slim as the official Oculus unit, but for the hacker market, who cares? Facebook can't patent the idea of VR, and if there's a market need for an open piece of hardware, a product will arise to fill it (maybe based on some of the stuff Avegant is doing?). An alternative platform wouldn't get the benefits of Carmack or the rest of the oculus team, but a hackable, performant headset is not a difficult problem for the geeks of the world to solve.

So where does this leave us? In the best of worlds, we get a glorious virtual future, with a virtualtastic Facebook experience, an awesome gaming and app ecosystem, and the freedom to use the excellent Oculus hardware for projects outside of the official app store. In the worst, we make a choice– buy the locked-down consumer hardware, or call a factory in China and get an open clone built.

First-world problems, folks.

Tangential: anybody want to work on a startup fantasy-investing app with the Crunchbase or Angelist APIs? I'm serious– you'd put a pool together with your friends, invest some fake money, and then rake from the pool proportional to the size of the exits in your portfolio.