Facebook Partners With Xiaomi On VR Headset For Chinese Market

Facebook and Xiaomi, a Chinese smartphone firm, are partnering with a view to launching a VR headset in China. This will present the Menlo Park, California-based tech giant with an opportunity to gain a foothold in the Chinese market where its main social media platform has been blocked for a long time. Since 2009 Facebook has been blocked in China and despite years spent by Facebook executives trying to court Chinese authorities, there has been little success.

According to Facebook the virtual reality headset which the two firms are jointly working on will only be available in China. It will bear the name Mi VR Standalone and is modelled after Oculus Go, which Facebook intends to launch this year at a price of $199 in other markets outside of China. Oculus Go will also be manufactured by Xiaomi.

Sharing of data

The deal with Xiaomi has partly been credited to Hugo Barra, a former executive of the Chinese electronics firms who joined the social media giant a year ago and charged with the responsibility of overseeing Facebook’s virtual reality efforts. Oculus VR, a VR firm Facebook acquired in 2014 at a price of over $2 billion, falls under Barra’s portfolio.

According to a spokesperson for Facebook the two firms will not share data concerning their users. The main Facebook platform will not be available to users of the VR headset though it will be possible for developers of the Oculus VR platform to share content to Mi VR platform in China. Both Xiaomi Mi and Oculus Go are standalone VR headsets and will therefore not need a smartphone or a computer to function.

Audience reach stagnation

The partnership between Facebook and Xiaomi comes in the wake of a report indicating the audience reach of the former declined in recent months. Per a report authored by Pivotal Research’s senior analyst, Brian Wieser, core Facebook consumption fell by 0.1% y-o-y in September despite user numbers rising by 4.7%. consequently the senior analyst has issued a sell rating on the stock of Facebook.

“While we continue to expect long-term top-line growth … we think risks to companies in the sector which are generally ignored by investors will have an impact on the sector over time, and should be factored into valuations,” wrote Wieser.

Though the decline in core consumption was small, it contrasted sharply when compared to the fortunes of Google which saw its properties including Gmail, YouTube and Google Search all growing by double digits.