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Marketing in Action Case Real Choices at Facebook Can virtual reality go mainstream? Facebook would like to Sony-HTC, working with Valve Corp., introduced the Vive, a believe the answer to that question is a resounding "yes!" The $799 headset designed to use while the user is standing up company has big plans for its virtual reality offering, the Oculus and walking around. Sony introduced the $399 PlayStation VR Rift, which is designed to transform how people play games,headset to compete as a lower priced option for the market. view videos, and share the experiences of their social lives. The In conjunction with its launch, Sony created a new PlayStation Rift is one of three premium virtual reality headsets new to the 4 with better performance to effectively run the virtual reality market, and it's no small market with estimated value at moreoptions. than $16 billion. Facebook CEO Mark Zuckerberg believes that virtual reality has come a long way in a short time and that we new technology and thus will initially appeal to a limited mar- are "entering the golden age of video and animation." Facebook understands that the Rift represents a really ket, although the growth potential is very high. Zuckerberg Inspired by the gaming market, Palmer Luckey, founder recognizes that video is presently the most popular mode of of Oculus, created a prototype for a virtual that would later become the Oculus Rift. In 2012, he began outlook is favorable, and some professional reviewers have a Kickstarter crowdfunding campaign to finance the develop suggested that this may be the biggest tech product since the ment of the product, eventually generating more than $2.4introduction of the iPhone (although using the Oculus Rift is million in funds. Over the next few years, the product wentsignificantly more complicated than using a smartphone). Yet through five working prototypes released to developers and despite the potential, success for the product and the technol- the public for feedback. In 2014, Zuckerberg raised the quesogy overall is not guaranteed. Now that Facebook has taken tion of what will be the next best thing in tech, and the an the steps to develop its new product, it has to find ways to swer was that it would be the viewing of movies, television,convince customers to adopt it. and other content in an immersive 3-D environment. Soon after, Facebook purchased Oculus for $2 billion. headset sharing but that virtual reality will soon be in second place. The You Make the Call In 2016, the Rift went on sale for $599, supported by doz- ens of games. Other uses include viewing conventional movies and videos, 360 3D videos, and "virtual reality movies." But alas, problems plagued the early stages of the product's introduction The first shipments were delayed by a component shortage in 8-38. the production process. Jason Rubin, Head of Studio, expressed 8-39. What the company's embarrassment, apologized for the delays, and8-40 offered free shipping to everyone who had placed orders. In ad- dition, some people complained of motion sickness when using the Rift. Oculus has since issued developers a software fix that wmla..M-ha".Mi-M1Mm'-nama-Nai reduces the likelihood that anyone will suffer any nausea. 8-36. What is the decision facing Facebook? 8-37. What factors are important in understanding this ded- sion situation? What are the alternatives? decision(s) do you recommend? What are some ways to implement your recommen dation? Other companies are rushing to join the virtual reality marketplace as well. Two of the major players are HTC and a-- -a-s-masan. usise-M.AR

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