Facebook

• The mission of leading Facebook's virtual reality business now falls on Hugo Barra, who joined Facebook six months ago with the newly-created title "VP of VR."

• Despite lackluster consumer interest, early missteps, and a lot of change in leadership, Facebook still has big plans to get a billion people into virtual reality.

• Barra sat down with Business Insider and explained how he intends to accomplish such a lofty goal.

Despite tepid interest from consumers so far, Facebook still believes it can turn virtual reality into the next big thing.

"We want to get a billion people in virtual reality," CEO Mark Zuckerberg said onstage at the company's annual Oculus VR conference for developers this week in California.

The goal is an exceptionally ambitious one even for Facebook, which already boasts 2 billion users.

Consider the current state of VR: Research firm Canalys recently estimated that only two million VR headsets were shipped globally in 2016, with Oculus accounting for 400,000 of those shipments. (Facebook has yet to publicly disclose how many Oculus headsets it has sold.)

Facebook's latest VR bet is its Oculus Go headset, which will start at $199 when it ships in early 2018. The Oculus Go is intended to fill the "sweet spot" between expensive, higher-end VR systems like the Oculus Rift and lightweight headsets like Samsung's Gear VR, Zuckerberg said during his keynote earlier this week.

"It’s hands down the most accessible way to get into VR," Facebook's Oculus chief, Hugo Barra, told Business Insider in an interview after the keynote. "We’ve designed it with comfort as the most important target we wanted to hit."

Oculus Go represents just one of Facebook's multi-pronged efforts to grow its VR business, which currently lags behind competitors like Sony and HTC. Oculus is also starting to work directly with businesses and is developing an untethered version of its flagship, most expensive Rift headset.

New ways to sell VR

The task of leading Oculus now falls on Barra, who joined Facebook six months ago with the newly-created title "VP of VR" after serving stints at Xiaomi and Google's Android division.

FacebookOne of Barra's recent announcements is the Oculus for Business Program, which allows enterprise customers to buy bulk orders of Oculus headsets for commercial use.

Oculus is already working with companies like Cisco and Audi to use its headsets in their workplaces, and expects to raise general consumer awareness of VR through the program.

That's because some of these businesses are creating VR apps for their own customers, Barra said. For instance, Audi is using Oculus Rift headsets to give customers virtual car demos at some of its dealerships.

"We think that working with some of these business is going to create great consumer awareness for VR in general," Barra said.

Such plans are not unique. Microsoft is doing much the same by targeting its augmented reality headset, HoloLens, to businesses as well. But the program is a new direction for Oculus, which has strictly focused on reaching consumers prior.

Meanwhile, Facebook will also try to raise awareness for VR in other ways. Oculus will run ad campaigns for its forthcoming Go headset and the lowered cost of its higher-end Rift system.

While Facebook currently has no plans to open retail stores, that idea isn't out of the question either, Barra said. "I think it’s plausible, but certainly not something we’re thinking about discussing at this point. It’s not a bad idea at all.”

In fact, Facebook tested the retail idea a bit last winter, when it showed off its Oculus Rift technology in various short-term pop-up stores around the country.

Business Insider

Missteps and hardships

While Oculus faces mounting pressure from competitors like Sony and HTC, the VR division has also undergone its own string of hardships since it was acquired by Facebook for $2 billion in 2014.

Prominent VR evangelist and Oculus cofounder Palmer Luckey was forced out of the company earlier this year after it was discovered that he secretly funded anti-Hillary Clinton advertisements around the 2016 election.

Aside from Luckey's departure, Oculus's other top leadership has been through a lot of other changes. CEO Brendan Irbe stepped down in December 2016 (he apparently still works on the Rift, but was noticeably absent from the Oculus conference this past week). Its head of mobile VR, Jon Thomason, left for Uber in September 2017 after less than a year on the job.

Facebook.com/oculusvrAnd back in February, Oculus was ordered to pay game maker ZeniMax $500 million in damages for a lost lawsuit. Facebook is in the process of appealing the ruling.

For now, Oculus has to battle increasingly fierce competition from gaming-focused headsets like Sony's PlayStation VR. Its untethered Santa Cruz headset, while impressive during a brief demo, doesn't have a ship date or price point yet. And Oculus Go won't ship in time for this year's holiday season.

Barra points to the 2,000 apps, including titles from the likes of Pixar, and over 100 million downloads on the Oculus platform as evidence that VR is already catching on outside of the early-adopter crowd. Zuckerberg has said Facebook plans to spend billions of dollars over the next several years on developing VR along with paying developers to create apps and games.

"Awareness comes with having a wide product portfolio," said Barra. "Amazing things take time to build."

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