March/April/May 2016
ON MARCH 26, DRESSED IN FLIP-FLOPS AND A RED HAWAIIAN SHIRT, PALMER Luckey flew up to Alaska and—freezing his ass off—planned to personally deliver an Oculus Rift to a customer named Ross Martin.
“This is the very first Oculus Rift,” Luckey explained to someone recording. “It’s signed by myself, Michael Antonov, Brendan, and Nate. So we are going to go and deliver it to Ross Martin, who was the first person to preorder. Let’s go!”
In theory, this quick trip was designed to do something special for Oculus’s first customer. But as Luckey spoke it was clear that this delivery was even more special for him than Martin. “Man, this is incredible,” Luckey said, after passing along the Rift. “I’ve been working on this thing for so long and you’re the first person to actually get one. It’s kinda like me taking all this work, and then handing it off to you; so you have to make sure you have fun with it or something . . .”
Martin promised that he would, and after a brief conversation about virtual reality, he thanked Luckey for making this unexpected trip. “I didn’t sleep at all last night. This is amazing. On behalf of the online community and everyone . . . we really appreciate all the transparency and outreach that you do.”
“I try to do as much as I can,” Luckey replied. He then shook Martin’s hand and ended by saying, “And now I need to get home as fast as I can, so I can keep working on the launch . . .”
UNFORTUNATELY, THE MOST PRESSING LAUNCH-RELATED ISSUE WAS THAT—contrary to everything Oculus had been saying for months—they would not actually be launching in full the following day.
Other than a few hundred units earmarked for their original Kickstarter backers, Oculus didn’t have any units in the US that could go out to consumers. Worse: it was still unclear when they would be able to begin fulfilling orders. Wednesday (March 30) seemed like the most likely option.
The delay was largely due to a shortage of suitable optics for the Rift (which, in turn, was largely due to Iribe setting a quality bar for optical components that—as a member of the exec team would later describe—was “probably too high . . . We ended up rejecting lenses that were better than what HTC was shipping on all Vives.”) Nevertheless, this was the situation Oculus was now in. And so, one day before what Luckey described as “the paperest of paper launches,” he outlined what he saw as three potentially viable options:
Looking at this list, Luckey thought the answer seemed obvious—#2: Be honest. As was often the case, he was joined in support by Nirav Patel. But in the end, they were outvoted, and Oculus wound up chancing it with a combination of #1 and #3.
ON MARCH 28, THE OCULUS RIFT LAUNCHED TO NEAR-UNANIMOUSLY PRAISE from the press. But despite splashy headlines like “This shit is legit” (Gizmodo1) and golden pull-quotes like “this is an astonishingly well-made device” (WIRED2), and the catharsis that came from shipping the world’s first modern VR headset, the day felt anticlimactic—disappointing, even—to many employees at Oculus.
To some degree, this was just human nature—the by-product of building up a dream for years and years and years. And to another degree, this felt like the hidden cost for all those moments of joy and excitement that had already been experienced at trade shows over the years. That was all part of it, as were concerns about the price, content and ceding the space to competitors. But while all these things were true, there was also something else—something at the bottom of it all—that was best summed up by the final line of Adi Robertson’s review for The Verge.3 “The headset you can buy today,” she wrote, “is not Oculus’ most ambitious vision for virtual reality—but it’s a vision that Oculus has successfully delivered on.”
CV1, of course, was never supposed wouldn’t be Oculus’ “most ambitious vision”; it was, after all, just meant to be the start. But shipping without motion controllers; and against a pair of upcoming headsets that more closely resemble Oculus’ original vision (Sony with affordability; HTC with immersion) it was hard for many at Oculus—on this day of reflection—to think about what they were shipping, instead of what they were not.
“COULD YOU PLEASE STATE YOUR FULL NAME FOR THE RECORD?” AN ATTORNEY asked the co-founder of Total Recall Technologies, during a taped deposition on the morning of April 8.
“Ron Danger Igra,” he replied, speaking directly to the camera.
“And could you spell your middle name, please?”
“D-A-N-G-E-R”
“Kind of like Austin ‘Danger’ Powers?”
“Kind of.”
Ron “Danger” Igra was the entrepreneur who—two years ago, in the aftermath of the Facebook acquisition—had messaged his ex-partner, Thomas Seidl, to suggest that they could “make millions together” by “going after Oculus.”
At the crux of this claim was a “Nondisclosure, Exclusivity and Payments Agreement” that Luckey had signed at Seidl’s request in August 2011 (shortly after the two had met on MTBS3D). Among other things, this agreement laid out terms for Luckey to build a pair of HMDs that could playback footage from the 3-D, 360-degree “immersive camera” Seidl was building.
Given this signed agreement, plus the types of paternity issues that often arise between inventors, it would seem understandable for Seidl to explore his legal options. But back when Igra contacted him in 2014—and repeatedly in the two years since—Seidl had explicitly said that he wasn’t interested in “going after” Luckey, Oculus or Facebook. Igra, however, felt differently; and in May 2015—on behalf of Total Recall Technologies (TRT), his and Seidl’s all-but-defunct partnership—Igra filed a suit against Palmer Luckey alleging “breach of contract and wrongful exploitation and conversion of TRT intellectual and personal property in connection with TRT’s development of affordable, immersive, virtual reality technology.”
Given the peculiarities of this case—like the fact that, while working for Seidl, Luckey had never once heard the names “Ron Igra” or “Total Recall Technologies” before; or that, just three days earlier, Seidl had reiterated his desire to “veto” Igra’s lawsuit—it was safe to say that the Total Recall case required far less of Luckey’s attention than the ongoing litigation with ZeniMax. And eventually, eleven months later (in March 2017), Igra’s case would be dismissed.4
At the time, of course, Luckey couldn’t have known that; so he took the lawsuit seriously—seriously enough to take the uncommon step of traveling to Wailuku, Hawaii, on April 8 so that he could exercise his right, as a defendant, to face his accuser and attend their deposition.
Though as he sat there, staring down Ron “Danger” Igra—trying not to laugh when Igra’s attorney claimed his presence was “intended to harass the witness”—Luckey realized that despite being three time zones away from Irvine, his mind was still all-consumed by Oculus and what critics were increasingly referring to as their “botched” launch.5
On April 11, podcaster Jeff Cannata tweeted, “Order processed 12 mins after Oculus went on sale. My new estimated ship date: 5/16-5/26, 2 months after “release.’ That’s a botched launch.”6 Hours later, Cannata’s two-month delay was put to shame when games journalist Patrick Klepek tweeted “The Oculus Rift that I pre-ordered has been bumped from shipping in April to June.”7 Unsurprisingly, frustrations about the delays were exacerbated by the relative silence from Oculus. It had now been nearly two weeks since the Rift’s alleged “launch,” and the only explanation that Oculus had provided was that a “component shortage impacted our quantities more than we expected . . . We apologize for the delay.”8
Meanwhile, in the midst of that backlash, another storm was brewing. And this one hit on April 14, with Luckey quickly receiving a flood of messages from concerned developers, who were linking to something that had just been posted on Reddit: “Play Lucky’s Tale and Oculus Dreamdeck on the Vive.” This post—written by a guy calling himself “Cross VR”—linked back to a GitHub page where people could download a plug-in that would make those games (and other content from the Oculus Store) playable on the HTC Vive.
ON MAY 20—IN AN EXECUTIVE DECISION SPEARHEADED BY MITCHELL—OCULUS issued a software update that, among other things, neutered Revive’s ability to play Oculus content on the Vive. The backlash was swift and unforgiving—with many citing Luckey’s Reddit comments from just a few months earlier: “If customers buy a game from us, I don’t care if they mod it to run on whatever they want.”
Luckey still felt that way, but he believed this situation was different than what he had described on Reddit for two reasons: one being that, with Revive, customers were not “buying games from us” (since they were getting access to free content like Lucky’s Tale) and two being that this wasn’t an example of “modding” but rather an example of “piracy.”
Given these circumstances, Luckey felt that if Oculus’s DRM decision had been communicated better, there was good reason to think that this approach would have worked.
“But we miscalculated, and it is really screwing us,” Luckey wrote to the Oculus exec team on May 25. “It is tempting to think this is a storm that will blow over like so many others—it is not. The bad media coverage, defections from usually friendly writers, trending on Facebook and Twitter, Reddit threads, and scathing videos from YouTube celebrities getting hundreds of thousands of views are only a symptom of the real problem: blowing out the trust of the people who actually want to see Oculus succeed by allowing them to see us as liars through lack of communication. That trust cannot be recovered with silence, and the longer the situation persists (especially the outright falsehoods), the deeper it will set.”
“Thanks for writing this up,” Iribe replied. “I’m not a fan of hardware DRM and would prefer we stick to a software only approach. What is the proposal to address this?”
The following afternoon, Luckey, Iribe, Mitchell, Binstock, Patel and Abrash got together to discuss possibilities. During this meeting—and then even more explicitly over email—Mitchell reiterated his case for the hardware DRM:
“For me,” Mitchell told the group, “this was the most important reason to make these changes. I don’t want us to be in a world where we can’t invest as heavily in the VR because it doesn’t make sense.”
“None of us want that,” Iribe replied, earning nods of agreement from Luckey, Binstock, Patel and Abrash. “But given our resources, we could invest regardless of whether we think it’s having a meaningful ROI.”
Mitchell conceded that was a good point.
“Also,” Iribe added, “as a child of the open PC ecosystem, I don’t think I can publicly support or defend a hardware DRM.”
Iribe’s words struck a chord with Mitchell, who thought that this alone might be reason enough to roll back Oculus’ update. “Especially,” Mitchell said, “with there being a lot of internal unhappiness.”
“We need to start communicating the background behind these decisions,” Luckey said several times that afternoon. He then reiterated this again in a lengthy email on May 31 that—over the course of 10 overarching points—elaborated his thoughts on this as well as what felt like an increasingly deeper battle with Valve:
1. “Rolling back with no solid explanation wastes the PR opportunity, and leaves people thinking of Oculus as a still-evil beast that they managed to control for the moment with community outrage.”
2. “We should not announce a date for rolling anything back. It should be communicated as something we will roll back once we have enough time to protect our platform and developers from piracy in other ways. People should be talking about why we are doing the ‘right thing,’ not when we are doing it.”
3. “We need to make it explicitly clear to people that this is not an endorsement of unofficial hacks of any kind, nor is it a promise to support them . . . We want all our customers to be first-class citizens with access to all the awesome features of the Oculus platform, store, and SDK.”
4. “Revive is designed to go far beyond just allowing people to play our games. It strips our games out of our platform and puts them into SteamVR, effectively turning us into a payment processor for a handful of exclusive games as far as Vive users go.”
5. “As of today, we have no path to supporting Vive without integrating Steam/SteamVR/OpenVR. That is exactly the way Valve wants it. Myself and the [“Jasons”] had some good discussion on why it could make sense to wrap them in a tricky way later this year as part of a strategy to get Valve users onto our platform . . .”
6. “We really did make an honest, good-faith effort to natively support Vive at the same level of quality we support the Rift, with access to all of our platform features and content. It could be that we would have chosen to not pull the trigger and go ahead with it in the end but we never got far enough to have that choice—Valve made that impossible for obvious reasons. Valve gains nothing by letting Oculus support natively without SteamVR. They know we have a better SDK, they know we are going to have a broader/better content lineup, they know all the things I talked about above. As long as Valve stays stuck to their platform, they win. The real twist in the current situation is that as of now, they get to have the ideal business decision AND the ideal PR! We take all the hits, we play punching bag, and they reap the benefit. I think there is a way to get people looking at this in a much more honest and critical way, business vs business instead of good vs evil. We do much better in an honest comparison than the current twisted narrative.”
7. “Valve gains a lot by effectively locking Vive users to SteamVR and their ecosystem. The current situation is basically the only reason they can get devs to target OpenVR/SteamVR and by extension, Steam: If the Oculus SDK supported Vive (or alternatively, if Vive did not exist), no developer would bother using SteamVR. Why would they?”
8. “We should realize that the most likely outcome of taking this stance is a stalemate. Again, Valve has no business reason to budge on this . . .”
9. “Valve is by no means invincible from a PR standpoint. We should not treat them as an unstoppable force and immovable object. They have gotten into pickles over the last few years that were generally solved by rapid backpedaling, but their standing is not what it once was. In the specific case of VR, they have failed to deliver on many of the things promised: OpenVR is not open or independent of SteamVR, Lighthouse is not an open standard, and use of the Vive is still tied directly to Steam. On top of that, their Rift support is still jankier than Vive support, a reflection of their priorities.”
10. “We can come out of this with a strong E3, a strong year, and a focus on why Oculus is great instead of why Oculus is bad. We won’t ever be seen as perfect, but we can be seen as the justified winners.”