That doesn't mean there hasn't been a lot of interest surrounding Oculus, noted Sterne Agee analyst Arvind Bhatia. "Oculus VR has been getting traction in the gaming industry and at the recent Game Developers Conference (GDC) this year, virtual reality in general and Oculus VR in particular, received a lot of attention," Bhatia wrote in a note to clients. "While gaming will be the near-term opportunity for Oculus VR's technology, Facebook envisions applications in other forms of entertainment and communications with the ultimate goal of helping it become 'the most social platform ever.'"
By doing this deal, Facebook moves slightly away from its core functionality, social networking and keeping everyone connected. Both the Instagram and WhatsApp deals were about connecting people and sharing, and it's hard to argue with the success. On the call, Zuckerberg noted Instagram had surpassed 200 million users, and WhatsApp is well on its way toward 1 billion users.
This deal is more focused on the next computing platform, similar to what Google (GOOG - Get Report) has done with Android. Piper Jaffray analyst Gene Munster, who rates Facebook "overweight" with a $67 price target, said this might be Facebook's "Android moment."
"We view the most interesting aspect of the acquisition is that it is in our opinion the first major acquisition that Facebook has made that is offensive," Munster wrote in a report, noting Facebook was acting forward-thinking like Google. "While one could argue, Instagram and WhatsApp as offensive in hindsight, we believe those platforms both threaten Facebook's core grasp on social time spent. We believe that Oculus is a big bet on the future of visual computing and we may see Oculus as Facebook's 'Android' moment 10 years from now and understand the point of the acquisition."
Virtual reality is still a long ways away from becoming a mainstream platform, and it's no guarantee it will get here. Personal digital assistants (PDAs) never really took off, and tablets were around for quite a while until Apple (AAPL) introduced the iPad in 2010, to name two examples. Still, people believe that virtual reality is coming, whether we like it or not.
"We're in the silent movie stage, and we're just starting to flesh out what opportunities are," Brouchoud said. "This tech enables shared experiences, travel to outer space, it's more about taking friends on a new voyage. I don't think we've even scratched the surface with what's possible."
-- Written by Chris Ciaccia in New York
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