Palmer Luckey, Oculus’ founder and inventor of the company’s iconic first VR headset, answered number of questions from the Reddit community in last night’s AMA (ask me anything), even admitting in a comprehensive question that his $350 ballpark figure on Rift pricing leading up to pre-orders ‘was handled poorly’.

Luckey answered a large bullet-point mega-question last night, culminating in an avalanche of answers regarding the Rift’s pricing, the newly revealed Oculus Remote, Oculus Touch and much more. Because Luckey managed to address many questions in the thread, we’ve condensed it down to show only new info.


Q: The price is what it is – I understand bleeding edge electronics is expensive. My question is: Why was the messaging about price so poor? $599 is not in the ballpark of $350 when your target audience is the mainstream.

Luckey: I handled the messaging poorly. Earlier last year, we started officially messaging that the Rift+Recommended spec PC would cost roughly $1500. That was around the time we committed to the path of prioritizing quality over cost, trying to make the best VR headset possible with current technology. Many outlets picked the story up as “Rift will cost $1500!”, which was honestly a good thing – the vast majority of consumers (and even gamers!) don’t have a PC anywhere close to the rec. spec, and many people were confused enough to think the Rift was a standalone device. For that vast majority of people, $1500 is the all-in cost of owning Rift. The biggest portion of their cost is the PC, not the Rift itself.

For gamers that already have high end GPUs, the equation is obviously different. In a September interview, during the Oculus Connect developer conference, I made the infamous “roughly in that $350 ballpark, but it will cost more than that” quote. 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. Later on, I tried to get across that the Rift would cost more than many expected, in the past two weeks particularly. There are a lot of reasons we did not do a better job of prepping people who already have high end GPUs, legal, financial, competitive, and otherwise, but to be perfectly honest, our biggest failing was assuming we had been clear enough about setting expectations. Another problem is that people looked at the much less advanced technology in DK2 for $350 and assumed the consumer Rift would cost a similar amount, an assumption that myself (and Oculus) did not do a good job of fixing. I apologize.

To be perfectly clear, we don’t make money on the Rift. The Xbox controller costs us almost nothing to bundle, and people can easily resell it for profit. A lot of people wish we would sell a bundle without “useless extras” like high-end audio, a carrying case, the bundled games, etc, but those just don’t significantly impact the cost. The core technology in the Rift is the main driver – two built-for-VR OLED displays with very high refresh rate and pixel density, a very precise tracking system, mechanical adjustment systems that must be lightweight, durable, and precise, and cutting-edge optics that are more complex to manufacture than many high end DSLR lenses. It is expensive, but for the $599 you spend, you get a lot more than spending $599 on pretty much any other consumer electronics devices – phones that cost $599 cost a fraction of that to make, same with mid-range TVs that cost $599. There are a lot of mainstream devices in that price-range, so as you have said, our failing was in communication, not just price.

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Q: What’s the rough cost breakdown that goes into the $600 cost of production? Roughly how many % of the price is the OLED, optics, audio, electronics, peripherals, and manufacturing?

And spoil the first tear down?! I wish I could share the detailed breakdown, but I cannot, for both internal and partner related reasons. I will use whatever credibility I have left to assure you that you are getting a pretty crazy deal.

Q: What are your plans in the future to make this product more affordable to the average person?

Continue working with GPU and CPU manufacturers to optimize for VR, thus reducing the required hardware cost. Use economies of scale and the passage of time to reduce the cost of good enough PC hardware. For the average person, the PC is by far the biggest cost, not the headset – the end goal is to make sure people can use the PC they already have in most cases.

exploded view of the new Oculus Rift

Q: Can we expect to ever see a cheaper, stripped down Rift SKU (-Xbox controller, -headphones, -games, etc)

Very unlikely for the first generation of Rift. A standardized system is in the best interest in developers trying to reach the widest audience, and we cannot significantly reduce the cost without dramatically reducing quality[…]

Q: John Carmack tweeted that he expects gaming to occupy less than 50% of the time we spend in the RIFT.. what kind of experiences is he eluding to. Oculus Medium? Toy box? How much is there to do in Toy Box?

Somewhat surprisingly, the majority of time spent right now in Gear VR is video and experiences, not games. Over time, VR span beyond games, much like the evolution of computer and mobile platforms before it. Right now, gaming is going to be the primary driver of PC VR, but the content base will expand over time.

See Also: Mark Zuckerberg on Oculus Toybox and Touch “The Craziest Oculus Experience”

Q: Palmer, the messaging you have been hammering out lately is “We’ll see you in the Rift”. How exactly will that happen?

Multiplayer and social experiences like EVE: Valkyrie, mostly! I can’t work all the time, gotta spend some time playing VR games myself.

Q: What accessories can we expect to see from Oculus for the Rift (replacement facial interface padding)

There are a range of accessories coming, and we’ll have a range of facial interfaces ourselves. Expect more news in the future.

Q: I want to know more about the small new remote. Can we play games with it? What was the decision behind it and what functionality can we expect from it?

We designed the Oculus Remote to be simple and intuitive input device for navigating VR experiences, especially when a fully-featured gamepad doesn’t make sense. An example is Oculus Video on Gear VR, which can be explored with just with gaze and tap. The remote is also ideal for non-gamers who want to try VR but aren’t familiar with a gamepad. It is also a good fit for apps that are ported across from Gear VR to Rift.

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Q: In what ‘ballpark’ can we expect Touch’s price to be?

No more ballparks for now. I have learned my lesson.

See Also: Oculus Rift Priced at $599, Expected to Ship in March

Q: What details can you share about the Remote? Does it include a gyroscope/accelerometer? Will the Kickstarter backer shipments will be in the March window? Will they have the same place in line for Touch orders? Will Oculus be artificially restricting use with computers below the min spec?

No gyro. It is essentially the input set of GearVR made into a remote. You are technically able to replace the battery, but the included battery life should last for about 4,000 hours of use.

Kickstarter backer shipments will be shipping in March. They will indeed have the same place in line for Touch, along with the other pre-order bonuses.

We will not be artificially restricting use of computers. Not my style. Some apps will run on lower spec machines, especially things like movie apps, but we can’t officially support that, especially since many low end cards are physically unable to output the framerate and resolution required for the hardware to operate.


Q: Will Oculus offer a way to buy additional IR cameras?

Yes, both as part of Touch, and individually.

Q: Multiplayer experiences are obviously going to be a big thing when it comes to VR. What is Oculus doing to ensure its not the Wild West out their for connecting to other Oculus users? I’d really rather not have to sign up to a hundred different gaming portals each with its own unique friends list and differing network performance…

Our games services provide devs the ability to use your Oculus Name throughout all of the Oculus games and experiences.

Q: Will upgrading to Windows 10 be required for Rift? Will it provide a better experience for the Rift specifically? (compatibility, setup, etc)

We support Windows 7, Windows 8, and Windows 10.

Q: When CV1 is out, what happens to DK1 & DK2 compatibility? are they phased out immediately or will the SDK allow seemless support for them for games and experiences? is this all on the developers themselves? Will the introduction of Touch phase out DK2 completely when it comes to games with “Touch required”?

We want to make sure that developers with DK1 and DK2 can continue developing for Rift. We’ll have more news on DK1 and DK2 compatibility over the next few months.

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Q: How Long will the Cables be from headset to PC, is it feasible to extend that length for room to vr experiences?

4 meters from PC to Rift headset, though use of extenders is often possible.

Q: Will Oculus offer extention cords and if not can you recommend a third party?

We will not be offering extension cords. No point in doing so when third parties like Amazon can sell for less than we can. Extensions will sometimes work, it depends on the PC and configuration, so no official support.

Q: Will the integrated DAC+amp be usable with third party headphones? e.g. through a 3.5mm jack on the headset. Or only with the shipped ones?

Not officially, and not without a little hardware hackery. Our DAC+amp are optimized for our specific driver modules, and are definitely not designed for high-impedance cans. The quality of our built-in audio stack is pretty great, if you really want something better, you are probably better pairing off with an external DAC.

Oculus Audio SDK impressions ces 2015 (2)

See Also: Oculus Rift ‘Crescent Bay’ is Designed for Audiophiles – Here’s Why that’s Important for VR

Q: Recommended specs are 970/290.. anyone buying a RIFT will EXPECT to play all games at max settings and have the best experience possible.. is a 970 up for that challenge? will NVIDIA’s Pascal GPU’s be better suited for VR? What will YOU (@palmer) be running on your Rift set up?

You won’t necessarily be able to play all games at MAX settings on the recommended spec. You will be able to play everything in the Oculus store at a high quality level (90 FPS) on the recommended spec. Personally, I am going to be running the standard rec spec rig to make sure I get the same experience as most users.

See Also: AVADirect and Road to VR Launch Exemplar, The Benchmark PC for High-end VR

Q: What kind of prices can we expect Movies/Experiences to have in the Oculus Store? Most experiences in the Gear VR store have been free.

There will be the range of prices from free to higher priced AAA games. The pricing will be similar to what you see in console PC games.

Q: Will Oculus Cinema be able to play our 3D/2D Bluray movies off the disc or do we have to go through the whole rip/convert phase.

On Gear VR, Oculus Video has a paid video store that features full-length films from our content partners. It also supports sideloaded video playback. You can expect similar features to come to Rift over time.

Q: Will only apps downloaded from the Oculus store work or will we be able to use software that is downloaded outside the app store?

You’ll be able to do both. You can download Rift titles from our store or elsewhere and run them.

We’d like to give credit where credit is due, to the Redditors who asked these questions, but Luckey responded to a deleted post that was pasted over from a number of disparate subreddits too. We mean no offense in anonymizing the questions, and hope you understand why we did so.

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Well before the first modern XR products hit the market, Scott recognized the potential of the technology and set out to understand and document its growth. He has been professionally reporting on the space for nearly a decade as Editor at Road to VR, authoring more than 3,500 articles on the topic. Scott brings that seasoned insight to his reporting from major industry events across the globe.
  • Mateusz

    Decend AMA, helped clear the air. Good work Palmer.

  • Michael Muchmore

    Doesn’t address my biggest concern: Have they solved the vertigo/dizziness/motion sickness-inducing aspects of VR?

    • Dave

      From other articles I have read it does sound like it. I don’t think they can guarantee it for everyone, but with the much higher refresh rates the majority of people shouldn’t experience it.

    • Steve B

      That’s not really something that can be solved by a manufacturer. That’s like telling a theme park that you love their rollercoaster but you’d love it more if you didn’t get motion sick.

      I say this as a developer – if you get simulator sickness or nausea from VR, it is probably the simulation developer’s fault. Oculus can improve the framerate, FOV, and resolution all they want, but it usually comes down to the software.

    • RickTheSlick

      Take a drama mine and don’t be such a pussy

      • andymac13

        Dramamine does nothing because there is no actual motion. I never get motion sick in real life. I have a dk2 developer kit and get sick in just about any game that has wasd/mouse movement in combo with head tracking. Not being able to play a game more than 30 minutes without feeling terrible is really a deal breaker. Have you ever tried playing any fps on the Oculus? This is still a major problem.

        • yag

          You just need to be accustomed with time, as for 80% of the Rift owners (a few % can’t be accustomed tho)

      • BeehiveRound

        ‘Dramamine can actually make things much worse for some people: “Dramamine is known to make you feel dizzy”

    • Doctor Bambi

      Some people still get motion sick playing games on traditional screens. There are software tricks developers can use to minimise motion sickness, but there’s always a risk you could get motion sick no matter what is happening on the screen. Best thing to do would be to just try the headset on and see how it affects you. Hopefully Oculus rolls out demo rigs to stores like best buy so everyone can try.

    • Kevin White

      They’ve solved the sickness caused by the headset itself, YES. This was caused by too much latency in the tracking, too much persistence in the screens, and crummy laptops trying to run VR. These problems are a thing of the past.

      Now, there’s still an issue of locomotion. If you’re playing Tiltbrush in Vive or Medium in Rift CV1 you’re not really moving over a large area and what movements you do make are translated 1:1 to the simulation. No motion sickness. Driving and racing games might cause a little, but I doubt it (unless you also get sick playing them now on a flat little 2D screen). First-person shooters……. potentially. Locomotion is something we’ll deal with. People will get used to it, some experiences will be only for some people, maybe FPSs will be played on a virtual 3D huge screen instead of inside the game, and then there’s stuff like Virtuix Omni.

      Finally, there’s the “good” kind of vertigo, the kind induced by believing you are where the simulation says you are. For instance, people got afraid of heights on the Rushmore demo for Vive, because it was so damned convincing. So if you were there in real life you’d feel the same thing. That’s an awesome form of motion sickness. We need more of that, and a rating system so people can judge the level of comfort of any given app.

      • Liviu

        I guess this will be a major challenge for Oculus: how do you ask for data if you genuinely want to use it for making the experience better when you have Facebook attached to your brand? :/

    • BeehiveRound

      Doubtful, it’s going to be person dependent, with DK2 derealization was also an issue for some people.

  • Full Name

    At least he tried to explain it, but in the end, his earlier remarks about ballpark of 350 caused some people that would normally tune out to keep being excited about it, and of course, just the fact that it is such a large discrepancy compared to the pricing they eventually landed on is an annoyance in itself.

    I could see 600 and probably a bit more as an ok price for the HTC Vive (plus they at least never mislead anyone by saying it will be cheaper). It is a solution that has far more potential. They can skip the fancy packaging/case, and inclusion of 2-3 games like the Rift did. Why include games that the buyer may not even care for? Give them some good demos instead.

    Heck, if Vive has a headphone jack, they could even sell that as an optional accessory. I think it is important they try to keep the cost down as much as possible, and realizing that lighthouse is probably more expensive than the simpler camera that Rift uses. If Vive can stay close in price, I think they have a shot at upsetting Oculus in terms of sales.

    • yag

      Read the AMA and you will have your questions answered.
      BTW the Vive will be even more expensive…

      • Full Name

        I don’t mind paying more for the Vive, as it has more functionality. If I bought the Rift, I would be kicking myself now and then for what I might be missing. As you can see from my post, I don’t really care much about the price in itself, but that they were misleading (at least HTC has never offered up a ballpark on the Vive), and that it might be smart to try to cut the cost somewhat.

        I’m only suggesting the Vive trying to keep costs down, for them to be (very) competitive vs the Rift that gets the majority of the coverage. In the end, I’d probably buy the Vive, at least when it hits around the $900 price point, though of course I would prefer it lower if possible. – and I got a pc waiting to use it on ;)

        • Lamanuwa

          I hope Valve can allow other manufacturers to make the VIVE. If you don’t allow hardware to compete, it’s not going to get cheaper.

          But I’m fully expecting HTC to go for $900 price point, they aren’t going to make money from games.

          On the other hand they aren’t involved in designing the software which frees them to focus on getting the hardware product ready and selling as much of it as possible.

          It’ll be interesting to see what’ll happen.

          • Full_Name

            That is the plan. HTC just happens to be first. In fact for the Lighthouse setup, Valve is giving this technology out for free (no licensing costs if you want to make your other trackers using their technology)

          • Lamanuwa

            I can’t wait till the VIVE goes on pre-order, I think I will go with them even if they were the same price or close. Unfortunately at these prices you can’t support both.

        • yag

          And why not waiting for the reviews, and go for the better ?

          • Full_Name

            That would be the best solution for most. Personally, having tried the Pre, I am certain the release version will be good, I don’t want to wait longer than necessary, and I am looking to create VR that utilizes room size tracking.

  • bendreality

    Hey guys,

    You have to think back. The first goal of the Kickstarter was very low. And in an early interview Palmer said that the goal wasn’t enough in the first place. Than there were some multimillion dollar companys came and gave oculus money and in the end it was facebook who bought them. I expect development at the edge of possible tech at this time very expensive. As the development went on the team surely steppet from problem to problem. To make VR a pleasing experience a lot of factors had to be taken into account. And if you are a developer and you have to make the descision for a product that is the first commercial attempt ever to sell it and the question is a good experience vs. lower consumer price. I think the descision was wise to go for a better product for a higher price.


  • RockstarRepublic

    ” A lot of people wish we would sell a bundle without “useless extras”
    like high-end audio, a carrying case, the bundled games, etc, but those
    just don’t significantly impact the cost.”

    Deep Breath….


    Of course those will significantly impact the price. Hell The Nvidia shield tablet removed the previously bundled pen and charger and cut the price down by $100.

    The case, the head phones, the controller… nearly every extra… plus the decision to try and make it super “premium” has driven up the cost by hundreds of dollars.

    If you are not making profit with $599, then you failed to make the product right. If you want to do a super premium version thats worth more… then do it LATER as an optional choice.

    Palmer has too much ego.

    • Liviu

      I think the part with ‘those just don’t impact the cost’ is true. At scale, the controller probably costs Microsoft $1 to make (it’s just how things work when you build millions of units per year). I don’t think the entire headset + all the accessories will costs more than $20 once they can commit to a few million units per year, but if you add the salaries of 20-30 software and hardware engineers at $100k-$200 per year + all the ’embedder tech’ contracts + cover the $2b investment, you see how the price can quickly go up. I do sympathise with them… it’s hard to do anything remotely innovative when Amazon sells tablets / phones for $50 with next day delivery :(

  • RockstarRepublic

    “Q: What are your plans in the future to make this product more affordable to the average person?

    Continue working with GPU and CPU manufacturers to optimize for VR,
    thus reducing the required hardware cost. Use economies of scale and the
    passage of time to reduce the cost of good enough PC hardware. For the
    average person, the PC is by far the biggest cost, not the headset – the
    end goal is to make sure people can use the PC they already have in
    most cases.”

    Notice how he didn’t answer the question. Its like asking Tesla how they can drive down the price of their cars… and Tesla responding with “well we will make sure more people can use it by having a bigger garage.”

    How did he come up with the design for a VR headset again?

  • Lamanuwa

    This is not how I thought the PC counterpart of VR would work. I thought Oculus would allow manufacturers to compete given a minimum satisfactory hardware standard.

    Now it looks more like a console (first party exclusives, an app store, closed hardware) where you make the hardware and you sell the software.

    I think this change requires a different strategy where you need to make the hardware as affordable as possible in order for your store to be prevalent among others.

    What I hear from Palmer Luckey is very much like what we heard from Ken Kutaragi. The question is, can you turn it around like Sony did, are you prepared for the criticism, the slow growth of your install base and having to endorse developers to work with you?

    I can’t believe both major PC VR devices went after the high end consumer and left mainstream wide open for anybody.

  • P. Pzwski

    I have a different question – what about technical support and guarantee for this product?

    I live in Europe – and if something breaks down in so expensive piece of hardware what I can do? Sent this back to US? Price for that will be insane.

    And what about tech specs? How can we spend so much money on something something that we know so little?

    Everybody wants VR, but there is too much question marks now…