Facebook is selling hardware for the first time, taking pre-orders for the Oculus Rift 3-D gaming headset.
The virtual reality technology gives users the illusion they are present in a digital world. Facebook bought Oculus VR, the company that makes the devices, for $2 billion in July 2014.
Prices for the headset start at $599 and are aimed at gaming enthusiasts, online gaming developers, virtual reality devotees and other early adopters willing to pay a premium to be among the first to own the devices, Colin Sebastian, analyst at Robert W. Baird & Co., says in a note to investors. By comparison, video game consoles PS4 and Xbox One sell for about $300, Sebastian says.
The Facebook ordering site says initial shipments of the Rift headset and system start March 28, but strong early demand could push deliveries back to May, Sebastian says. On Thursday, the Oculus Rift site said orders were limited to one per customers and expected to ship in June.
The Rift will be sold in 20 countries where it is certified to ship, says a spokeswoman for Oculus. The countries include Australia, Belgium, Canada, Denmark, Finland, France, Germany, Japan, Iceland, Ireland, Italy, Netherlands, New Zealand, Norway, Poland, Spain, Sweden, Taiwan, United Kingdom and the United States.
Sebastian says most consumers will need to spend at least $1,500 for both the headset and a computer to run the technology at full strength. The Rift ships with a sensor, an Xbox One controller and built-in headphones and microphone; its Touch controller will be shipped later in the year, he says.
Analysts say they expect Facebook to sell a few hundred thousand units this year but to take a loss on the product because Facebook will spend a lot of money for hardware, content and marketing.
While online gaming is the initial Rift market, the technology is expected to serve as a platform for other applications in e-commerce, education, communications and health care, Sebastian says.
Lou Kerner, a partner with angel investor firm Flight.vc, says “Facebook CEO Mark Zuckerberg sees this as another way to engage users very deeply so they spend more time in the Facebook ecosystem.”
Facebook did not respond to a request for comment. The Oculus spokeswoman says the company foresees demand for virtual reality devices increasing dramatically.
Kerner says such retailers as Best Buy Co., No. 14 in the Internet Retailer 2015 Top 500 Guide, and GameStop Corp. (No. 58) likely willsell the Oculus headset and its peripherals, and new retailers could join in as the virtual reality market grows.
“We’re in the top half of the first inning of the next great computing wave,” Kerner says.Favorite