Oculus Will Release the Rift Headset For Free (Eventually)

Oculus VR’ virtual reality headset could eventually be given away for free says CEO Brendan Iribe.

According to Iribe, if the company finds the right business model the current $300 price-point could be significantly lowered to the point where it could be given away for free and the company would still make a profit. How does that work?

Iribe went on to explain that rather than a peripheral the Rift is a platform in and of itself and that Just like Microsoft’s Xbox and Sony’s PS the Oculus Rift could end up being subsidised. Iribe stated that the company would like to establish partnerships with different companies in order to lower the price point.

“We’d love it to be free one day, so how do we get it as close to free as possible? Obviously it won’t be that in the beginning. You can imagine if Microsoft and Sony can go out and subsidise consoles because there’s enough money to be made on software and other areas, then there’s the potential that this, in partnership, could get subsidised.”

Iribe also stated his belief that the lower the price-point the wider the audience and explained that the company is open to “relationships and strategies” that could drive the price down. He also expressed his desire to see Rift compatibility on PS4 and Xbox One, and stated that he would like to see Sony and Microsoft jump on the VR bandwagon.

“Let’s say there was some game you played in VR that everybody loved and everybody played and we made $100 a month – or even $10 a month – at some point the hardware’s cheap enough and we’re making enough that we could be giving away the headset.”

Even though the inverse relationship between price and demand is correct (with the exception of Vleben and Giffen goods) a wider audience doesn’t necessarily mean higher profits; the net change in terms of revenue will depend almost entirely on the price elasticity of demand of the good. In this case, the Rift.

As of right now, the Oculus Rift is only available as a $300 devkit and Oculus VR has raised $16m in funding.