Oculus Rift Boss Explains The Price Confusion

We first speculated, then we got the confirmation but had to wait for a little while before we could place our pre-orders on the final Oculus Rift. Yesterday was the big day and the pre-order queue was opened up to the public. At the same time, we also got the pricing that so far had been down to speculations and vague statements. However, the price tag of $600 did confuse quite a few people as we’ve previously heard of a price that should be in the “ballpark of $350”. That is quite a bit of difference and Palmer Luckey, the Oculus boss and founder, took it on to answer the confusion in a Reddit Ask Me Anything (AMA).

Luckey apologized for the misleading information and went on to explain how it came to be. At the time where the statement was made, quite a few people believed that the $1500 estimated price floating around was for just the headset, but it was actually for a VR ready PC system. And compared to $1500, $600 is more in the ballpark of $350, hence the confusion.

“I handled the messaging poorly,” Luckey said. “As an explanation, not an excuse: during that time, many outlets were repeating the ‘Rift is $1500!’ line, and I was frustrated by how many people thought that was the price of the headset itself. My answer was ill-prepared, and mentally, I was contrasting $349 with $1500, not our internal estimate that hovered close to $599 – that is why I said it was in roughly the same ballpark.”

Luckey went on to explain the costs. It looks like they aren’t making much if any profit from this first consumer version of the Oculus Rift. It is being sold at cost. This is great for both the consumer and the technology itself, we need it to stick and stay around. It’s time for a shift in our virtual experiences.

When compared to the DK1 and DK2, the final Oculus Rift uses hardware that’s a lot more advanced and made just for this headset rather than off-the-shelf parts. If it had been released with DK2 hardware, the price would still have been $400 or more. With all this in mind, I think the consumers will be happy that Oculus didn’t take any shortcuts but opted for the best possible hardware right away.

“DK1 and DK2 cost a lot less – they used mostly off the shelf components. They also had significantly fewer features (back of head tracking, headphones, mic, removal facial interfaces, etc.) For Rift, we’re using largely custom VR technology (eg. custom displays designed for VR) to push the experience well beyond DK2 to the Crescent Bay level.”

Considering that most people don’t have any trouble throwing $600 after a new fancy smartphone or TV, it’s not that bad at all. I do however think that I might hold back a little myself and wait for a price around the $450 before I join the world of virtual reality.