VR / AR strategy and One

[ … ] Not shown: Why he is writing: recent talks about accelerating VR / AR.

Our vision is that VR / AR will be the next major computing platform after mobile in about 10 years.¹ (Fact note 1)Fact · 1With hindsightMeta reports its VR and AR work in the Reality Labs segment. For 2025, ten years after the email, it reported Reality Labs revenue of $2,207 million against $198,759 million for Family of Apps. The 2021 founder’s letter on this site follows Reality Labs’ losses year by year.SourceMeta, earnings release (Exhibit 99.1)Meta Reports Fourth Quarter and Full Year 2025 Results28 Jan 2026 It can be even more ubiquitous than mobile – especially once we reach AR – since you can always have it on. It’s more natural than mobile since it uses our normal human visual and gestural systems. It can even be more economical, because once you have a good VR / AR system, you no longer need to buy phones or TV’s or many other physical objects – they can just become apps in a digital store.

[ … ] Not shown: Three business goals: strategic, brand and financial.

The strategic goal is clearest. We are vulnerable on mobile to Google and Apple because they make major mobile platforms.² (Editorial note 2)Editorial · 2Known at the timeThe case starts from dependence, not from demand for VR. Every later argument, Unity included, is a way to avoid being a tenant on someone else’s platform a second time. The email is candid that apps alone would not change that: “If we only build key apps but not the platform, we will remain in our current position.”Sourcesriramk.com (copy of the email)Zuck on buying UnityOct 2019 We would like a stronger strategic position in the next wave of computing. We can achieve this only by building both a major platform as well as key apps.

[ … ] Not shown: Platform and apps both needed; timing; brand; ecosystem parts.

The key apps are what you’d expect: social communication and media consumption, especially immersive video. Gaming is critical but is more hits driven and ephemeral, so owning the key games seems less important than simply making sure they exist on our platform.³ (Fact note 3)Fact · 3With hindsightIn 2022 the FTC said Meta had “purchased seven of the most successful virtual reality development studios”, and that buying Beat Games “gave Meta control of the wildly popular app Beat Saber”. It then sued to block Meta’s purchase of Within, maker of the fitness app Supernatural. On 31 January 2023 the court denied the FTC’s request for a preliminary injunction. On games, what Meta went on to buy went further than this email proposed.SourcesFederal Trade Commission (Internet Archive copy)FTC Seeks to Block Virtual Reality Giant Meta’s Acquisition of Popular App Creator Within27 Jul 2022US District Court for the Northern District of California (CourtListener)FTC v. Meta Platforms, Order Denying Plaintiff’s Motion for Preliminary Injunction13 Dec 2023 I expect everyone will use social communication and media consumption tools, and that we’ll build a large business if we are successful in these spaces. We will need a large investment and dedicated strategy to build the best services in these spaces. For now though, I’ll just assert that building social services is our core competence, so I’ll save elaborating further on that for another day.

[ … ] Not shown: Platform services, offered across systems, including on Android.

Second, this platform definition is not actually an OS in the technical sense. In modern OSes, however, most of the value comes from advantaging the OS provider’s own platform services on the devices where its OS is installed. I think our primary platform strategy should not be focusing on building a fully independent OS, but owning these core platform services across all systems.⁴ (Fact note 4)Fact · 4With hindsightOn 22 April 2024 Meta opened Meta Horizon OS, which it called “a full mixed reality operating system used by millions of people”, built on “the mobile-first foundations of the Android Open Source Project”, to third-party hardware makers. The same release describes a social layer of identities and avatars “made to bridge multiple platforms”. Meta built its own operating system, and describes its social layer as cross-platform.SourceMeta NewsroomIntroducing Our Open Mixed Reality Ecosystem22 Apr 2024 This will be challenging as OS providers will try to push us out, but if we build superior services and provide things OSes need (eg Unity support), then we have a good shot at success.

[ … ] Not shown: Hardware and systems have little standalone business value.

Our overall vision for the space is that we will be completely ubiquitous in killer apps⁵ (Fact note 5)Fact · 5With hindsightFacebook did not comment on this email when it was published, and we have found no Meta statement confirming it; the copy we read shows no recipients. TechCrunch published it on 13 February 2019, saying Blake Harris, author of “The History of the Future”, had sent it the full email, which Harris says Zuckerberg sent to Brendan Iribe, “Sheryl Sandberg and a half-dozen other Facebook leaders”; TechCrunch “has not independently verified the contents of the email”, and Facebook “did not comment on the email”. In July 2022 the FTC’s complaint over Meta’s purchase of Within quoted this phrase, “the next wave of computing” and “us[e] acquisitions opportunistically” from “an internal email to key Facebook executives” sent “As early as 2015”; its press release called it “a publicly reported email”. The copy at sriramk.com marks two places with ellipses, so it may not be complete.SourcesTechCrunchFacebook mulled multi-billion-dollar acquisition of gaming giant Unity, book claims13 Feb 2019Federal Trade Commission (Internet Archive copy)Meta/Within: Complaint for PI and TRO27 Jul 2022Federal Trade Commission (Internet Archive copy)FTC Seeks to Block Virtual Reality Giant Meta’s Acquisition of Popular App Creator Within27 Jul 2022sriramk.com (copy of the email)Zuck on buying UnityOct 2019, have very strong coverage in platform services (like Google has with Android) and will be strong enough in hardware and systems to at a minimum support our platform services goals, and at best be a business itself.

In order to achieve this vision, there are many different investments we’ll need to make. In key apps, we have no social app effort yet and our video effort is weak. We’re going to need to jumpstart both. In platform services, we’ve started building an identity, app store and payments with Oculus, but we’re years behind Valve and Google⁶ (Fact note 6)Fact · 6Known at the timeThe email claims Facebook was “years behind Valve and Google” in platform services and “leading in headsets, controllers and low level SDK for VR”. We have not found an independent source for either judgement. They are Zuckerberg’s own assessment, made to the executives who would fund the catch-up.Sourcesriramk.com (copy of the email)Zuck on buying UnityOct 2019, and we haven’t even started on the avatar and content marketplace. In hardware and systems, we are leading in headsets, controllers and low level SDK for VR, but we don’t have a real development / graphics system and we’re far behind on AR.

[ … ] Not shown: Some pieces must be bought to reduce the risk.

Given our own strengths, we will probably be best served building most apps and platform services internally while using acquisitions opportunistically, and then acquiring most of the core VR / AR and 3D tech where we have little experience. This is why I am supportive of acquiring Unity⁷ (Fact note 7)Fact · 7With hindsightWe have found no record that Facebook or Meta bought Unity. TechCrunch reported in 2019 that “a Unity deal never came to fruition”. On 17 September 2020 Unity priced its own initial public offering at $52.00 a share, to trade on the New York Stock Exchange as “U”. We have not checked whether Facebook bought an AR company in the years the email names.SourcesTechCrunchFacebook mulled multi-billion-dollar acquisition of gaming giant Unity, book claims13 Feb 2019Unity Technologies (Internet Archive copy)Unity Announces Pricing of Initial Public Offering17 Sep 2020, expecting we will acquire an AR company in the next few years and opportunistically acquiring VR app teams, while also consistently encouraging us to ramp up our internal investment on our platform services ourselves.

[ … ] Not shown: Why invest in hardware; Unity sits at the right level.

If we own Unity, we can ensure this always happens well, happens quickly and happens with our systems. If we do this integration with Unity, the Unreal and others will prioritize delivering great experiences with us as well and we will push the entire market forward. If we don’t own Unity, then at best we can incentivize them to prioritize doing this for us and everything will just move more slowly, but at worst someone may acquire them and block this from happening at all or with us.

At some level, it’s important to own the core technology you depend on to achieve your mission.⁸ (Editorial note 8)Editorial · 8Known at the timeIn his messages to Kevin Systrom about buying Instagram, also on this site, Zuckerberg wrote that Facebook’s goal was “to be the engine (or platform) that helps produce other engines (or apps)”, and that a partner could plug in and lose nothing. Here he argues the reverse for Facebook’s own dependency: relying on an engine it does not own is a risk worth billions to remove. Both positions follow one rule, take the platform role, and together they show its cost: what Facebook offered partners as safe, it would not accept for itself.Sourcessriramk.com (copy of the House Judiciary production)Facebook_Redactions.pdfJul 2020sriramk.com (copy of the email)Zuck on buying UnityOct 2019 Even if there is potentially a path forward with it, owning it increases integration opportunities and decreases risk.

[ … ] Not shown: Unity would make Facebook’s services the default for developers.

If we own Unity, then Android, Windows and iOS will all need us to support them on larger portions of their ecosystems won’t work. While we wouldn’t reject them outright, we will have options for how deeply we support them.⁹ (Editorial note 9)Editorial · 9Known at the timeThe email turns the risk it fears into a tool: owning Unity would give Facebook the discretion over Android, Windows and iOS that it says Google and Apple hold over it. It does not price the trade-off. Unity’s value to developers rested on running everywhere, which is why the email also promises to “continue Unity’s promise of supporting every development environment”. Leverage over platforms and neutrality towards developers pull against each other. The first sentence is garbled as printed; TechCrunch marked it “[sic]”.Sourcessriramk.com (copy of the email)Zuck on buying UnityOct 2019TechCrunchFacebook mulled multi-billion-dollar acquisition of gaming giant Unity, book claims13 Feb 2019

[ … ] Not shown: Bargaining with Android and Apple, a hostile buyer, and the cost.