Three big questions about Facebook’s new VR ads

Yesterday, Facebook took a leap many people have been predicting for years: it started putting ads inside virtual reality. The company launched a limited test of advertisements inside three Oculus Quest apps, saying it would expand the system based on user feedback. The move is a turning point for Oculus, bringing one of Facebook’s most controversial features into a medium that inspires both idealism and alarm. And it raises three big questions about Facebook’s future and immersive computing.

The first question is how deeply Facebook will end up linking advertising with hardware sensor data. Even more than smartphones, Oculus Quest headsets are a gold mine of information about you. They capture precise head and hand motion, pictures of your surroundings through tracking cameras, and microphone audio for Facebook’s voice command system. Future headsets will likely include even more intimate features like eye tracking, which would offer incredibly precise metrics on what captures your attention in VR.

Right now, Facebook says much of this data either never leaves your headset or is completely segmented from its advertising system, and it says it has “no plans” to do things like target ads based on movement data. But as Facebook moves deeper into virtual and augmented reality, using its hardware’s special features for advertising will become an increasingly attractive prospect.

Immersive computing is a gold mine of intimate data

Facebook is reportedly working on a fitness tracker and has discussed building AR glasses that you’ll use to interact with the world. These products are custom-built to produce quantifiable insights about your body and surroundings, and it’s hard to believe Facebook doesn’t have plans to monetize that — even if Facebook Reality Labs head Andrew Bosworth has said the company is “not really focused on business model” questions for experimental hardware. Oculus is Facebook’s first big test case for advertising on its own computing device, and as it expands ads on VR and other hardware, we’ll see how it handles the wealth of new data types it’s collecting.

The second question is how ads will affect VR development. Several of the bestselling VR titles right now feel like substantive console or PC games and sell at a similar price. By contrast, it’s not yet clear which app genres work well with an ad-based model. (Blaston, the first game we know includes ads, is a multiplayer dueling game that you play in short competitive bouts.) Whatever those genres are, Facebook just created an incentive to make a lot more of them, since developers get a cut of the revenue involved.

It’s easy to imagine dystopian scenarios like a huge library of attention-grabbing but low-quality games and social apps plastered with pop-ups, or the seizure-inducing corporate hellscape from Ready Player One. It doesn’t help that Facebook’s first tests look like flat banner ads from a website or freeware game. That said, Facebook is notoriously picky about what goes into the Quest library and there’s no indication that will change soon.