As they fight for market dominance, both Facebook and Google can be
expected to make bold bets on the future. One especially expensive
route leads to virtual reality, and that’s where Facebook stole the
march on the industry. In 2014, Zuck paid $2 billion for Oculus Rift,
the leading VR headset company.^28 Following that acquisition, he
raved, “VR will open up new worlds.” Spoiler alert: it hasn’t.
People were envisioned strapping on headsets to attend virtual
work meetings. Surgeons in New York and Tokyo could operate in the
same virtual theater. Grandparents would spend virtual time with
their far-flung grandkids. In this way, Facebook would get into our
heads. It would usher in a new platform—not just for communication,
but for spending time together in virtual worlds. The business
opportunity was immense.
Following Zuckerberg’s lead, venture firms poured hundreds of
millions into VR start-ups. Soon, other tech companies, including the
Four, were plowing research into the technology. Nobody wanted to
sleep through the Next Big Thing.
Virtual reality is the mother of all head fakes. The most powerful
force in the universe is regression to the mean. Everyone dies, and gets
it wrong along the way. Mark Zuckerberg has been (very) right about a
lot of things and was due to make an enormously bad call. And he has.
Technology firms do not (yet) have the skills to shape people’s
decisions on what to wear in public. People care (a lot) about their
looks. Most don’t want to look like they’ve never kissed a girl.
Remember Google Glass? It got people beaten up. The bottom line is
everyone wearing a VR headset looks ridiculous. VR will be to Zuck
what Gallipoli was to Churchill, a huge failure that shows he can be
(very) wrong, but won’t slow his march toward victory. The company
is still positioned to dominate the global media market—and reinvent
advertising for the twenty-first century.
Insatiable
A devouring beast, Facebook will continue with more of the same.
With its global reach, its near-limitless capital, and its ever-smarter
data-crunching AI machine, Facebook, in combination with Google,