Facebook Buys Oculus Rift for $2 billion
Software designer Julian Kantor (L), who created "The Recital" takes a picture of Jonathan Feng (R) as he uses the Oculus Rift virtual reality headset to experience his program during E3 in Los Angeles, California June 12, 2013. Reuters

Facebook has continued to splash the cash by completing a $2 billion (£1.2bn) deal to purchase Oculus VR, the startup company which has created the Oculus Rift, a virtual reality gaming headset.

The acquisition - which follows the $19bn acquisition of messaging app WhatsApp last month - was announced by a statement by Facebook with CEO Mark Zuckerberg saying that the social network was beginning to look beyond mobile:

"Mobile is the platform of today, and now we're also getting ready for the platforms of tomorrow. Oculus has the chance to create the most social platform ever, and change the way we work, play and communicate."

The company will maintain its current headquarters in Irvine, California, and will continue to develop the "ground-breaking" Oculus Rift.

The Oculus Rift is the flag bearer for a virtual reality gaming revolution which could come to maturity in 2014, with devices like the Cast AR and Omni last week joined by the high-profile launch of Sony's Project Morpheus headset for the PlayStation 4.

Moving beyond gaming

It is uncelar exactly what immediate changes the acquisition by Facebook could have on the direction of the Oculus Rift, but the social network said it wanted to expand the virtual reality technolgy beyond gaming to communications, media and entertainment, and education.

"Given these broad potential applications, virtual reality technology is a strong candidate to emerge as the next social and communications platform," the company said.

The Oculus Rift was initially funded by $2.4 million on the crowdfunding Kickstarter website. It has since received backing from a number of investors totalling $91 million.

75,000 units of the Oculus Rift development kit have been in the hands of game developers for the last year and just last week the company announced the availability of the development kit mark two, which would feature a high definition display.

There is no clear indication of when a consumer model of the Oculus Rift might launch but reports suggest it will be available in late 2014 or early 2015.

The $2 billion deal is made up $400 million in cash and 23.1 million shares of Facebook common stock. There is an additional $300m of cash and stock if the employees of Oculus VR reach certain targets.