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Facebook on buying spree???

Biz Break: Facebook buys virtual-reality startup Oculus for $2 billion
By Jeremy C. Owens

POSTED: 03/25/2014 02:51:17 PM PDT# COMMENTS
UPDATED: 03/25/2014 05:09:34 PM PDT

Facebook shocked Silicon Valley with another acquisition Tuesday, agreeing to purchase virtual reality company Oculus VR for $2 billion just a month after committing $16 billion -- and likely more -- to obtain WhatsApp.

The Menlo Park social network announced Tuesday afternoon that it had promised $400 million in cash and 23.1 million shares of Facebook, valued at $1.6 billion based on recent trading averages, to secure the private company known for its Oculus Rift virtual reality headset.

While the Oculus Rift has been demonstrated mostly as a platform for gaming, Facebook is interested in more, with founder and CEO Mark Zuckerberg hinting in a post on the company's platform that the technology could turn into Facebook's version of Google Glass, the Mountain View company's wearable computer.

"Imagine enjoying a court side seat at a game, studying in a classroom of students and teachers all over the world or consulting with a doctor face-to-face -- just by putting on goggles in your home," Zuckerberg wrote Tuesday.

"One day, we believe this kind of immersive, augmented reality will become a part of daily life for billions of people," he later added.

Oculus will continue to develop the Rift helmet as a gaming device independent of Facebook, Zuckerberg said, but the Irvine company will then begin to focus on new frontiers for virtual reality. Uses Facebook mentioned in Tuesday's announcement included communications, media and education.

"We believe virtual reality will be heavily defined by social experiences that connect people in magical, new ways," Oculus co-founder and CEO Brendan Iribe said in Tuesday's news release. "It is a transformative and disruptive technology, that enables the world to experience the impossible, and it's only just the beginning."

Tuesday's acquisition is another audacious and expensive bet on future technology by Facebook, which announced on Feb. 19 that it would acquire Mountain View mobile-messaging application WhatsApp for $16 billion, which was also broken down into cash and stock. Like that deal -- which included $3 billion more in possible stock rewards for employees moving from WhatsApp to Facebook -- Oculus's agreement includes possible future benefits, which could reach an additional $300 million.

Post by Mark Zuckerberg.
WhatsApp brought with it a large, global user base, while Oculus has yet to commercially release an actual product, shipping a version of the headset for developers last year and currently offering a new developers kit for pre-order. Still, the company has stoked excitement in the gaming and tech communities with its demonstrations at various conferences and other gatherings, winning a 2013 Crunchie award for best hardware startup. The company announced in June 2013 that it had raised $16 million in a venture-capital round led by Spark Capital and Palo Alto-based Matrix Partners.

Facebook stock gained 1.2 percent to $64.89 in regular trading Tuesday, appreciably less than the $69.35 price Facebook used in calculating the total value of the stock transferred in the Oculus acquisition. Shares declined about 1 percent in after-hours trading following Tuesday's announcement.
Mark Zuckerberg is such an ingenious guy. Currently the Facebook stock is quite overpriced (most of future growth is already factored in). Zuckerberg is not only cashing in on future money by buying up these companies with Facebook stock, at the same time, he is buying potentially the biggest company in tech, in the future.

lol. Like Facebook, Oculus and Whatsapp is one of its kind, has many potential but lacks proven track record.

UPDATED: Facebook to acquire Oculus Rift virtual reality headset manufacturer for ~$2B

ON MARCH 25, 2014

Facebook today announced that it intends to acquire Oculus, the Los Angeles-based company making the crowdfunded Oculus Rift virtual reality headset, in a deal worth up to $2 billion. The deal will be made in a mixture of cash ($400 million) and stock (23.1 million shares worth approximately $1.6 billion based on the stock’s current value) and provides for an “additional $300 million earn-out in cash and stock based on the achievement of certain milestones.”

The acquisition marks Facebook’s first entrance into the hardware market, and will offer the company control over the virtual reality headset expected to define the market even as Sony, Microsoft, and other companies are developing their own products.

Facebook explained the rationale behind the acquisition in its blog post:

While the applications for virtual reality technology beyond gaming are in their nascent stages, several industries are already experimenting with the technology, and Facebook plans to extend Oculus’ existing advantage in gaming to new verticals, including communications, media and entertainment, education and other areas. Given these broad potential applications, virtual reality technology is a strong candidate to emerge as the next social and communications platform.

‘Mobile is the platform of today, and now we’re also getting ready for the platforms of tomorrow,’ said Facebook founder and CEO, Mark Zuckerberg. ‘Oculus has the chance to create the most social platform ever, and change the way we work, play and communicate.’

Zuckerberg expanded on those thoughts in a Facebook post:

This is really a new communication platform. By feeling truly present, you can share unbounded spaces and experiences with the people in your life. Imagine sharing not just moments with your friends online, but entire experiences and adventures.

These are just some of the potential uses. By working with developers and partners across the industry, together we can build many more. One day, we believe this kind of immersive, augmented reality will become a part of daily life for billions of people.

Oculus offered its explanation for the sale in its own blog post:

At first glance, it might not seem obvious why Oculus is partnering with Facebook, a company focused on connecting people, investing in internet access for the world and pushing an open computing platform. But when you consider it more carefully, we’re culturally aligned with a focus on innovating and hiring the best and brightest; we believe communication drives new platforms; we want to contribute to a more open, connected world; and we both see virtual reality as the next step.

Most important, Facebook understands the potential for VR. Mark and his team share our vision for virtual reality’s potential to transform the way we learn, share, play, and communicate. Facebook is a company that believes that anything is possible with the right group of people, and we couldn’t agree more.

PandoDaily spoke to Oculus investor and board member Antonio Rodriguez of Matrix Partners today who called the deal an “incredible financial outcome” and described the negotiation process as very fast from start to finish.

“I think that’s one of the big advantages of being a strong founder CEO is the ability to run quick process – both knew what they wanted and moved quickly.” Rodriguez says, referring to both Facebook’s Mark Zuckerberg and Oculus’ Brendan Iribe.

Matrix led Oculus’ June 2013 Series A round and participated in its $75 million Series B in November of that same year, maintaining its status as the company’s largest outside shareholder. The company has sold more than 70,000 units to date across its first- and second-generation products and offers Facebook the opportunity to enter the Apple-like territory of combining hardware, software, and services models.

Today’s announcement marks the second high profile exit for the LA startup ecosystem this week following Yesterday’s $950 million acquisition of Maker Studios by Disney.

This deal represents Facebook’s first foray into hardware and the company’s first marquee acquisition outside of its core social verticals of photos and messaging. While the rationale may not be immediately obvious to outside observers, Rodriguez calls it highly strategic and a big bet on the next generation platform – virtual reality and wearables.

“It’s almost an Android-like bet, but one with a lot more zero’s on the back end,” he says.

Oculus’ founders and its investors had no intentions of selling and were not actively pursuing buyers, Rodriguez tells me. Rather, the company was fully committed to building a massive, category-defining company. It’s a narrative that doesn’t fully jive with today’s news, but obviously the company felt like Facebook’s resources could help them achieve that goal quicker and on a bigger scale.

“[While it hasn't done consumer hardware] Facebook has terrific systems engineering, as evidenced by their open compute program,” Rodriguez says. Zuckerberg also promised Iribe and his team the kind of autonomy that he famously granted Instagram and Whatsapp as part of their acquisitions.

“We certainly felt a level of commitment to the vision and autonomous execution or this would not have happened,” Rodriguez says.

Oculus investor Chris Dixon (who, disclosure, is a personal investor in Pando) wrote about the acquisition and why he initially invested in the company on his blog:

Virtual reality has long been a staple of science fiction. In real life, however, attempts to create virtual reality have consistently disappointed. Oculus was founded on the contrarian belief that the right people at the right time could finally deliver on the science fiction promise. Hardware components had become sufficiently powerful and inexpensive, and the pioneering engineers who invented 3D gaming were eager to explore a new frontier.

Last year, my partner Gil Shafir and I spent time studying Oculus and virtual reality technology more generally. The more we learned, the more we became convinced that virtual reality would become central to the next great wave of computing. We were therefore thrilled when we got the chance to invest in Oculus later on.

Pando weighs in

Sarah Lacy wrote about Facebook’s willingness to spend vast amounts of capital to acquire nascent startups following the company’s $19 billion acquisition of WhatsApp:

The mo’ money, no problem attitude isn’t just limited at valuations. In 2006, Facebook was the only startup that had furniture from Design Within Reach– rather than startup staple Ikea. And Facebook was the biggest spoiler in the Techtopus Silicon Valley wage-fixing plot, reported here on Pando by Mark Ames. While other Valley companies conspired to keep wages artificially low, Facebook had no issue bidding mightily for talent, forcing wages to rise across the industry. Facebook also revived the late-1990s Cisco habit of swallowing companies whole just to get their talent– jump-starting the recent years’ acquihire boom. And, of course, with the $1 billion Instagram deal, Facebook was the first to put a $1 billion price tag on a mobile-first company that was less than two years old.

Facebook is like a reverse Amazon. If Amazon squeezes out prices through efficiencies and passes on the savings to everyone else; Facebook sucks in cheap capital through high valuations and spreads the inflation to the rest of the Silicon Valley machine.

She also wrote about how Facebook CEO Mark Zuckerberg’s claim that WhatsApp will operate independently like many of Facebook’s other acquisitions was a little less than forthcoming:

Pre-Instagram that level of autonomy was precisely not what Facebook was known for, particularly when it comes to its acquisition strategy. People acquired into Facebook did well. Their projects were killed almost immediately. They fit into the Borg and there was no pretending otherwise.

Zuckerberg’s blithe ‘this is just how we roll’ explanation of how WhatsApp will fit shows how different Facebook’s acquisition strategy has become pre-IPO roadshow and post-IPO roadshow. Acquisitions were previously a means of assimilating talent, and Facebook was better at that game than most. Now, with the wherewithal of a surging public stock, the success of Instagram behind it, and the obvious fear of the inflection point of the mobile Web, Facebook’s game plan has changed. Deals need to move the needle, and the company has the currency to go big. It’s less Borg and more Voltron. (Or Frankenstein if the strategy becomes unwieldy.)

Instagram CEO Kevin Systrom might be glad that Facebook successfully acquired Oculus, as building virtual reality features into its service might be harder than cloning Snapchat:

Above all, this proves how valuable Instagram is to Facebook. The app is just getting started in its advertising efforts, which will likely become a sizable business for Facebook. But the intangible value Instagram creates in fending off competitors is even more more meaningful.

The copycat label may sting, but you have to hand it to Systrom for once again walking the fine line between responding to competition but not looking like a pathetic rip-off artist the way Facebook did with Poke. Instagram Direct is different enough from Snapchat that Systrom can say with a straight face that this is still an Instagram product. Instagram power users will likely eat it up the way they did with video, and it may staunch the bleeding of users spending more time outside of the Facebook/Instagram walls.

But Zuckerberg should tread carefully: Too many more calls to his copycat hit man and he may destroy the reason he paid $1 billion for the distinct mobile social network to begin with.

Reactions from around the Web

Iribe laid out his virtual reality dreams to Re/code earlier this year:

‘A decade or two from now, it will be nothing but sunglasses,’ Iribe said at the time. ‘You’d put them on and have this new virtual world.’

Intriguingly, he described in that interview a hypothetical social/messaging application for the Rift that would let people be ‘finally free of this 2D monitor.’ The application, he said, would let people communicate in a 3-D, 360-degree virtual environment, as if they were standing in the same room.

‘Kids will one day look back and laugh at FaceTime,’ Iribe said.

Polygon reports on a call Zuckerberg and Iribe held after the announcement:

In an investor call this afternoon following the announcement, Zuckerberg noted that most of his company’s recent work has been targeted toward making Facebook available everywhere through mobile apps. He indicated that Facebook is satisfied with that progress, and ready to shift focus.

‘We feel strong enough in our position that we want to focus strategically on building the next big platform that will be coming after mobile,’ said Zuckerberg. ‘Today’s acquisition is a long-term bet on the future of computing. I bet Oculus can be one of the biggest platforms of the future.’

Minecraft creator “Notch” announced that he has canceled plans for an Oculus Rift version of the game:

We were in talks about maybe bringing a version of Minecraft to Oculus. I just cancelled that deal. Facebook creeps me out.

Additional reporting by Michael Carney.

(This post will be updated as we learn more.)

[Image credit: Wang65 (Creative Commons)]
Oculus is one of its kind? Disruptive technology? Seeing is believing!
*** say you see/watch it first on

(26-03-2014, 04:12 PM)Wildreamz Wrote: [ -> ]Mark Zuckerberg is such an ingenious guy. ...
he is buying potentially the biggest company in tech, in the future.
... one of its kind, has many potential...
The tax amount is approx 41 mil share x $55, or more than $2 billion in a year. No wonder he could called Obama directly...Big Grin

Facebook CEO reaps S$4.1 bln gain from stock options

SAN FRANCISCO -- Facebook CEO Mark Zuckerberg reaped a US$3.3 billion (S$4.1 billion) gain last year by exercising stock options in the social networking company that he founded in a Harvard University dorm room.

The windfall saddled Mr Zuckerberg with a huge tax bill, even though he limited his Facebook salary to just US$1, according to regulatory documents filed Monday.

It marks the second straight year that Mr Zuckerberg has realised a huge gain on the holding that he has accumulated in Facebook since he started the company in 2004. In 2012, Mr Zuckerberg made US$2.3 billion off his stock options.

Mr Zuckerberg, 29, now has exhausted his supply of stock options after exercising 60 million of them last year a price of 6 cents per share. He then sold 41.35 million shares for US$55.05 apiece in December, primarily to pay for his tax bill on the gains.

Mr Zuckerberg and his wife, Priscilla Chan, also donated 18 million Facebook shares to a Silicon Valley nonprofit. The December gift, then valued at nearly US$1 billion, landed the couple at the top of The Chronicle of Philanthropy’s annual list of the most generous Americans.
Facebook is completing its offerings, ahead of competition from China...

Facebook plans to provide mobile payment services: FT
15 Apr 2014 05:55
[LONDON] Facebook Inc is preparing to join the mobile-payments race with remittances and electronic-money services on the social network, the Financial Times reported on Sunday, citing several people involved in the process.

The company is close to obtaining approval from the Central Bank of Ireland to start a service that would allow users to store money on Facebook and use it to pay and exchange with others, the people told the FT.

The company has also had partnership talks with at least three London start-ups - TransferWise, Moni Technologies and Azimo - that offer online and mobile international money transfer services, three people involved in the discussions told FT.

Facebook's specific plans, including which countries the electronic-money services would be available in, were not immediately clear.

The market for mobile and electronic payments is heating up, as technology companies, telecom groups, retailers and banks all try to get a foothold in a business that is expected to grow rapdily in the next few years. - Reuters

Source: Business Times Breaking News
Facebook warns of increased spending, shares fall

SAN FRANCISCO - Facebook Inc warned on Tuesday of a dramatic increase in spending in 2015 and projected a slowdown in revenue growth this quarter, slicing a tenth off its market value.

The hefty spending plans exposed the first signs of stress in the rock-solid support that investors have accorded the social networking company over the past year.
Facebook cracks down on unpaid small-business marketing


CHRISY Bossie built a $US100,000 ($118,000)-a-year gemstone e-commerce business by sharing information about her products on her company’s Facebook page several times a week.

“Steals in the Shop! I have a TON of new 36-inch-long necklaces, most priced at $US15, available in amethyst, lapis, watermelon tourmaline, turquoise ... Shop them all here,” she wrote in a recent marketing post on a Facebook page for Earthegy, the business she runs from her home in rural Kent Store, Virginia.

She also included photos and links to the products, hoping the business’s 70,000 Facebook fans would share the posts with their own Facebook friends. But small-business owners like Bossie will soon get less benefit from the unpaid marketing pitches they post on Facebook.

That’s because, as of mid-January, the social network will intensify its efforts to filter out unpaid promotional material in user news feeds that businesses have posted as status updates.

The change will make it more difficult for entrepreneurs like Bossie, the founder of four-year-old Earthegy, to reach fans of their Facebook pages with marketing posts that aren’t paid advertising.

Businesses that post free marketing pitches or reuse content from existing ads will suffer “a significant decrease in distribution”, Facebook warned in a post earlier this month announcing the coming change.

The upshot for Bossie is that “if I do not pay to promote the post or boost it, it’s hardly reaching anyone”, she says. More than half her sales come via her Facebook posts.

More than 80 per cent of small companies using social media to promote their businesses list Facebook as their top marketing tool, followed by LinkedIn and Twitter, according to a survey.

Additional reporting: Reed Albergotti

The Wall Street Journal
It is the same issue of "negative reputation" in VB, but in a very smaller scale compare with FB "dislike" issue. Tongue

I recall FB allow users to express emotion in their posts...

Mark Zuckerberg mulls over ‘Dislike’ button for Facebook

LONDON — Facebook chief executive Mark Zuckerberg has spoken of his desire to provide users with the ability to express a wider range of emotions, hinting at an addition to the existing “Like” button on Facebook posts in his second public Q&A.

Speaking at the company’s headquarters in California, Mr Zuckerberg admitted to concerns that current methods of interaction on the site might sometimes be inadequate.

“A lot of times people share things on Facebook that are sad moments in their lives,” he said. “What’s the right way to make it so people can easily express a broader range of emotions? To empathise?”

A “Dislike” option is the feature most requested by Facebook users, said Mr Zuckerberg, 30, and he did not dismiss the idea altogether, calling it an important area of discussion.

But he also expressed reservations that a button designed to communicate negative sentiment could end up being used in the wrong way and as a means of demeaning other people’s posts.

“We need to figure out the right way to do it so (the button) ends up being a force for good, not a force for bad,” he added.
RIP Mr. Goldberg. Base on the report, he was a humble yet capable man, but died young at 47. It shows how fragile a life, a fall off a treadmill can kill...

Facebook's Sandberg emerges to speak at husband's memorial

STANFORD, Calif - Facebook Inc Chief Operating Officer Sheryl Sandberg re-emerged in public on Tuesday after the accidental death of her husband last week, telling a Silicon Valley memorial service about his effortless compassion and selflessness.

Many of the technology world's top executives filled a 1,700-seat auditorium at Stanford University to commemorate David Goldberg, chief executive of SurveyMonkey, who died at age 47 on Friday during a vacation in Mexico. He fell off a treadmill and hit his head.

The ceremony was a tribute to the low-key executive, whose marriage to Sandberg added to his fame from building a company valued at $2 billion.

Speakers described Goldberg's self-deprecation, modesty and selflessness, and the event, closed to the press, included several nods to his passions: on their way out, guests were handed Minnesota Vikings baseball caps as a reminder of the Minneapolis-born Goldberg's lighthearted nature and love of sports, according to a person who attended the service and declined to be identified.

During the ceremony, Bono sang "One." Goldberg's brother, Robert Goldberg, who announced the death on Saturday morning on Facebook, and several friends spoke at the private service, the person said.

Many guests entered through side and back doors after driving into a cordoned-off area behind the hall. Some, such as Hewlett Packard Chief Executive Meg Whitman, walked up the steps and through the main entrance. Whitman declined to speak with reporters after the service.

Many began offering personal tributes to Goldberg on social media on Saturday, including Facebook Chief Executive Mark Zuckerberg. Sandberg, however, remained silent until Tuesday morning, when she responded to a public note by President Barack Obama.

"David Goldberg embodied the definition of a real leader - someone who was always looking for ways to empower others," the president wrote in a Facebook message signed B.O., meaning he personally wrote it. "We're heartbroken by him leaving us far too soon - but we celebrate a remarkable legacy."

Sandberg in turn took to Facebook, thanking Obama for his friendship. "Dave Goldberg admired you for your leadership, passion, and your deep love of sports," she wrote.

She also changed her Facebook cover photo on Tuesday morning to a picture of her dancing with Goldberg at their wedding in 2004.

Goldberg built SurveyMonkey into a poll-taking juggernaut after joining the company in 2009. He previously worked for venture firm Benchmark, after founding Launch Media and selling it to Yahoo Inc in 2001. REUTERS
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