I talked with Oculus Rift creator Palmer Luckey about working at Facebook, being worth $700 million at 23, and the future of virtual reality
We last spoke over the phone back in 2013 when the Oculus Rift was still a runaway Kickstarter project, back before the team showed Mark Zuckerberg a prototype. Zuckerberg loved it, calling it "one of the coolest things I've ever seen," and Facebook ended up paying $2 billion for Oculus a year later.
That means Luckey is now a multi-millionaire - Forbes pegs his net worth at $700 million - and I point out how surreal that must feel, reaching that level of wealth a few short years after giving up his journalism studies to pursue virtual reality full time.
"This may sound - everyone says this - but it's not about the money," says Luckey, who's wearing a blue polo shirt and fidgeting with a bottle of water. We're sitting at a round table inside of a small demo room deep within the Oculus booth at this year's Consumer Electronics Show in Las Vegas.
Luckey was studying to become a tech journalist when he decided to pursue his vision.
"I didn't get into tech journalism for the money, I didn't get into VR for the money. When I was in tech journalism, I thought I was taking a break from school after Oculus took off. That seemed like the riskier path at the time. Like 'I'm almost done with my degree in tech journalism, am I really going to give up my career in tech journalism for this wacky VR thing?' Well that sounded like a lot of fun, so I'm going to go do that."
The journey has just begun
So Luckey dropped out of college and the gamble paid off, but Luckey's personality - quirky but genuine, laid-back but you can still tell his mind is thinking a mile a minute - is a refreshing break from that of the usual Silicon Valley tech startup founder. This is the guy who originally planned to simply sell the plans for building the Oculus Rift to virtual reality enthusiasts so they could build it themselves, the cheapest way at the time to get the technology into people's hands.
Two weeks ago, Oculus reached a major milestone as pre-orders for the consumer version Oculus Rift went live. The site was flooded with people willing to fork over $600 for a chance to get in on the ground floor of virtual reality. While he says he can't talk about any solid sales numbers because "financial disclosure stuff," the shipping date for new pre-orders has already slipped from March to July.
I ask Luckey what's going through his mind at this point, does he feel any weight lifted off his shoulders?
"Launching pre-orders is relatively easy compared to shipping a product. So it's not like 'What a weight off your shoulders!', when in reality, taking pre-orders is the point where you are finally making an actual, solid commitment to when you're going to ship, and how much you're going to ship for, and you can't stumble between when you do that and when you're supposed to ship. It's actually not a weight off of my shoulders at all."
So the stress levels are actually getting kicked up a notch?
"It's impossible to do that," he says, laughing before adding "but it's a good time, don't get me wrong."
A controversial price tag
The price did cause some controversy. The headset will cost $600, and that's not including the powerful gaming computer required to run the thing. Luckey and Oculus execs had said in years past they were targeting somewhere in the $200 to $400 range, but even after Luckey began hinting that the final price tag could be even higher, there were many that took to Twitter and virtual reality forums to voice their displeasure.
"It's also worth noting that there's a difference in reaction to the price between people who are buying it and people who aren't," he says. "We are selling a ton of Rifts."
Luckey is also quick to admit there was a bit of disconnect between the price people were expecting and what was announced.
"People have valid criticisms of the way we handled the messaging around our price. I think the price criticisms around what it cost are slightly less valid, but at the same time, people's concerns are still valid. When they say 'This isn't going to be mainstream,' I could talk about how reducing the cost of our headset from $599 to $499 doesn't really matter when the all-in cost for a non-gamer is still gonna be $1400 to $1500 [including a computer to run it]. But at the end of the day, there's a lot of people who do have graphics cards that are already compatible, and for them the cost of the headset is really the only cost, and from their perspective, I totally get what they're saying."
Robert Galbraith/ReutersLuckey reveals the prototype Oculus Touch motion controllersLuckey argues that all of his decisions have been increasingly long-term when compared to back when the Rift was a Kickstarter project. The Facebook acquisition allowed the team to shift its focus from simply making something accessible to "making the best," and so the company's strategy shifted, and they also partnered with Samsung to ship the $99 Gear VR headset on the side to ensure people could buy an entry-level headset that would work with their Samsung phone.
"We are attacking the high-end, trying to build the best thing possible, and we are working on Gear VR, which is $99, works with the tens of millions of people who have modern Samsung phones. The reality is, these are decisions are all mine and Oculus', and it's because we think they're the best decisions for the long term. And we haven't abandoned gaming, we haven't abandoned the high end, we also haven't abandoned the low end. It's really hard to keep every group of people happy when everyone wants a different thing."
The $600 price tag could have easily been higher too. Oculus maintains it's selling the Rift "at cost," and it's opting to ship with an Xbox One controller and wireless remote instead of including its Touch motion controllers that give players the chance to see their hands tracked in VR. The Touch controllers, held in each hand, allow you to pick up objects, give a thumbs up to other players, or use them as virtual guns during a firefight.
In most games, aside from flight simulators (where a joystick would feel more natural) or driving simulators (which feel best with a steering wheel), the Touch controllers definitely up the immersion levels.
Luckey and the Oculus team know this - they've purchased a slew of computer vision startups in the past couple of years that all involve hand tracking - but they still need to give game developers the time to build rich games and experiences that incorporate this tech, even its Touch controllers.
Avoiding Microsoft's Xbox One-Kinect debacle
When talking about the decision to ship the Touch controllers separately and in the latter half of 2016, the best parallel to make is when Microsoft announced it was bundling its body-tracking Kinect sensor with every Xbox One, without the option to purchase just the game console. The decision caused a huge controversy, and after Sony announced the PlayStation 4 would be launching for $100 less than the Xbox One, Microsoft eventually ended up reversing its decision.
Luckey doesn't want to repeat that mistake.
"That's kind of one of the things that we looked at when we thought about bundling Touch," Luckey says. "Do we really want to bundle this thing that is significantly raising the cost, and making the barrier to entry higher, when a lot of people are going to say 'Why did you bundle this stupid s---, I don't want it.' Now I might think it's super cool and important, but a lot of people wouldn't want it, and what we wouldn't want to do is promise developers we were going to bundle Touch, get them worked up around building Touch games, and then say 'Just kidding, we're not bundling it.' That would have led to fallout. So we've been kind of executing on the same plan for a long time, and we have an aggressive timeline, but it's a realistic timeline."
After finally getting the chance to try these titles on one of Oculus' latest engineering samples for the consumer edition of the Rift, I'm convinced: 2016 is going to be The Year of VR.
Even without the Touch controllers, these games are insanely fun to play, and the immersion is so incredible that anything I would say would sound like hyperbole. (Oculus fans will also be please to hear Luckey mentioned that "We've actually made some further improvements from what you're going to get in the box and these show units.")
The craziest thing? The long wait is almost over - the Rift is less than three months away.