• by Catharine P. Taylor , March 28, 2014

For the record, I hope I am never spotted with a shoebox strapped to my head, which -- far as I can tell -- is essentially what Oculus VR is all about. (You know, that virtual reality company that Facebook bought this week for $2 billion?)

And you thought people who wore Google Glass looked like idiots.

Supposedly, this Oculus VR is one hot technology, so hot that the creator of Minecraft got serious about it before deciding, in a fit of Facebook-pique, that he was no longer going to create a version of Minecraft for the technology, because, and I quote: “Facebook creeps me out.”

That’s a good thing, because it means, if my family is lucky, that our 10-year-old daughter will also never be spotted with a shoebox strapped to her head, either. If you haven’t noticed, Minecraft is all the rage with the kids these days.

In essence, that’s exactly why Facebook bought Oculus VR -- because it’s all the rage, not among 10-year-olds, but among the hoodie-wearing set. Is it an allegedly cool technology that makes people look irredeemably goofy? Why… yes! But will it make Facebook a lot of money? Who the hell knows?

It actually doesn’t matter, because increasingly, Facebook’s business model is about fashion, and since no one knows what will be fashionable in tech even a year from now, it is buying up all it can, as long as it is still sitting on a pile of cash and has a $58 billion market cap. Why worry about silly little things like the rapid decline in advertisers’ organic reach on the platform, when there are so many bright, shiny objects to buy?

New Facebook business model: Let’s go buy stuff!

 The truth is, though, that Facebook is right to be concerned about staying on the cusp of fashion despite this columnist’s cracks about shoeboxes. While there’s no immediate crisis, Zuckerberg & Co. should be haunted by the specter of decline that has faced nearly every hot tech company of the last 20 years, with only two notable exceptions: Apple and Google. Both Apple (market cap: $479 billion) and Google (market cap: $376 billion) have the stable, proven revenue streams and gargantuan sums of money required to be on a tech-buying spree. In fact, in terms of revenue and market cap, either has the ability to make Facebook look like an also-ran.

And Facebook knows this, and probably knows that its advertising model may never have the staying power of either of those companies. This means that, in terms of acquiring hot new companies, in many cases, Facebook is going to have to act fast. Buying up a promising -- but nascent -- virtual reality company is a perfect example of this tactic.

Yes, you can make the case that virtual reality makes more sense strategically for Facebook than for Apple or Google, because lately people have this annoying tendency to never want to hang out with each other in the physical world. And you’d have a point. The same goes for something like WhatsApp, the communications platform that Facebook bought earlier this year for a mere $19 billion.

But in doing so, you’d also be making the case that both acquisitions were extremely strategic, when in fact they aren’t. WhatsApp’s founders, famously, hate advertising. And virtual reality? It’s impossible to know what sort of revenue-generator Oculus will be, or if it will even end up being a player in the virtual reality arms race.

So ultimately, what these acquisitions are about is placing bets, with Facebook not being a social network so much as it is a v.c.  For now, in the ever-shifting world of tech, it’s not the worst thing in the world if Facebook is a bit of both.