Remember how in the 1990s everybody was excited about virtual reality, but the results wound up being a bit…lackluster? I personally recall excitedly putting on a Virtual Reality headset at an arcade as a child expecting an amazing immersive experience, only to find myself confronted with laggy pixelated monsters. That letdown, I think, sums up the experience of virtual reality in the 1990s: Our enthusiasm for it outpaced our technological ability to actually make it happen.
Today, however, there’s been a resurgence of interest in virtual reality. Thanks to advances in hardware improvements from the mobile phone industry, it is now possible to make virtual reality headsets with incredibly high fidelity. And a startup company has built the first one. Their first product, the Oculus Rift, is said to provide an incredibly immersive experience, in which one’s brain appears genuinely fooled into thinking it is in a different place. This, understandably, has caused gamers to salivate in anticipation, while others, from artists to mental health professionals and, of course, pornographers, began imagining a huge diversity of uses for the technology.
Last week, Oculus and Facebook made a joint announcement that Facebook had acquired the rights to the company for $2 billion. Mark Zuckerberg’s statement proposed using the Rift to “…create the most social platform ever, and change the way we work, play and communicate”, while Oculus’ site said they “we want to contribute to a more open, connected world”.
The righteous indignation from the gaming community proved that hell hath no fury like a geek disappointed. Oculus were condemned as sellouts and worse. Game developers, including the highly influential Notch of Minecraft fame, began jumping ship. Angry gamers made dystopian predictions about virtual reality advertisements and Facebook harvesting retinal scan data from gamers. The former concern may have some merit. In an internal Facebook conference call about the acquisition, Mark Zuckerberg hinted about the possibility of using the Rift as an advertising platform; though he admitted that they would “need to figure that out down the line”.
We’ve all seen this before. Gamers react this way virtually every time Electronic Arts acquires another game studio. But one new thread of the outrage over Oculus’ acquisition is very interesting. Oculus was initially crowdfunded, and was indeed hyped as major a crowdfund success story. Now, the early crowdfund backers are expressing their ire. And they have a point: Part of the promise of a crowdfunding campaign is that the developers seeking funding will use it to pursue the vision they advertised to their early supporters. Selling their controlling stake to a larger company severely compromises that.
This debate has some important implications for the development of radical technologies. We are currently in an era in which a lot of big, revolutionary technologies such as self-driving cars, artificial intelligence and even commercial space travel are emerging. The problem is that most of these big moonshot projects are funded by traditional capital, which tends to be technologically conservative. Crowdfunding offers a way to subvert that because it changes the incentive structure. It allows the developers of radical technologies to appeal to popular excitment about the technology itself rather than capitalist excitement about profits in order to get off the ground. And this can some much riskier and more disruptive innovations to have a fighting chance.
Oculus, however, has just demonstrated a major flaw with this. Because while major financial backers will be reluctant to put any money towards radical technologies at a very early stage, they will clamour at the chance to invest once these new innovations have demonstrated their viability. Backing a revolution can be extremely profitable. The problem is that when people who are primarily interested in profit back something, it might become less revolutionary. As I demonstrated in a previous post, big companies tend to be more interested in maintaining the status quo, because a major socio-technical transition will force them to change the way they do business and that costs money. So even if Mark Zuckerberg is sincere when he says that he wants to use virtual reality to completely changing the way people connect with each other, the next big capitalist to come along and buy out an exciting new crowdfunded startup might have far more conservative goals. It is even conceivable that if a crowdfunded technology represents enough of a threat to the status quo, it will be bought up purely so that it can be shut down.
The implication is that crowdfunding needs a bit of tweaking if it is going to really subvert traditional ways of developing technology and doing business. Some mechanism will have to be built into crowdfunding drives to protect them from being bought up by big players as soon as they show serious promise. Social shaming such as that endured by the staff at Oculus might work, but legal mechanisms would probably be better. Perhaps it would possible to write a contract into a crowdfunding campaign that would stop the company being funded from selling their controlling stake in the company within a particular period after the end of the campaign. I’m not a lawyer and so I don’t know if this would be possible, but if crowdfunding campaigns started to use such agreements, then the potential represented by websites such as kickstarter will be greatly amplified. Otherwise, crowdfunding could represent little other than capitalism by other means.