Oculus needed advanced Samsung displays that weren't in mass production. Since money alone couldn't convince Samsung to build them, Oculus offered to develop the software and hardware for Samsung's Gear VR. This partnership was the only way to secure the critical components needed for their flagship Rift headsets.
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Unlike Apple's high-margin hardware strategy, Meta prices its AR glasses affordably. Mark Zuckerberg states the goal is not to profit from the device itself but from the long-term use of integrated AI and commerce services, treating the hardware as a gateway to a new service-based ecosystem.
Meta is laying off staff in its metaverse division, shifting focus from VR to AR. The move is a response to clear market signals: the AR-driven Ray-Ban smart glasses sold 2 million pairs, while the VR-centric Horizon Worlds has fewer than 200,000 monthly users.
Tech giants often initiate custom chip projects not with the primary goal of mass deployment, but to create negotiating power against incumbents like NVIDIA. The threat of a viable alternative is enough to secure better pricing and allocation, making the R&D cost a strategic investment.
After pivoting from hardware to software, SkillVari found value in reintroducing proprietary hardware (like a $2,500 welding gun) as optional accessories. This hybrid model leverages commodity headsets while capturing additional revenue and creating a more immersive, defensible user experience.
Seemingly strange deals, like NVIDIA investing in companies that then buy its GPUs, serve a deep strategic purpose. It's not just financial engineering; it's a way to forge co-dependent alliances, secure its central role in the ecosystem, and effectively anoint winners in the AI arms race.
NVIDIA's multi-billion dollar deals with AI labs like OpenAI and Anthropic are framed not just as financial investments, but as a form of R&D. By securing deep partnerships, NVIDIA gains invaluable proximity to its most advanced customers, allowing it to understand their future technological needs and ensure its hardware roadmap remains perfectly aligned with the industry's cutting edge.
OpenAI is actively diversifying its partners across the supply chain—multiple cloud providers (Microsoft, Oracle), GPU designers (Nvidia, AMD), and foundries. This classic "commoditize your compliments" strategy prevents any single supplier from gaining excessive leverage or capturing all the profit margin.
Beyond capital, Amazon's deal with OpenAI includes a crucial stipulation: OpenAI must use Amazon's proprietary Trainium AI chips. This forces adoption by a leading AI firm, providing a powerful proof point for Trainium as a viable competitor to Nvidia's market-dominant chips and creating a captive customer for Amazon's hardware.
When Facebook first offered $1B for Oculus, founder Palmer Luckey turned it down. His early, significant Bitcoin holdings made him financially independent, so he didn't care about the money. This forced Facebook to return with a much larger R&D commitment ($1B/year for 10 years) that aligned with his mission, not just a higher price.
Palmer Luckey reframes his firing from Facebook by arguing that Oculus ultimately achieved its mission by taking over Facebook's R&D focus and corporate direction. His vision for the metaverse became the dominant component of Facebook's spend and future, which he views as a successful 'reverse takeover' of the parent company's mission.