- Palmer Luckey doesn't think the Meta layoffs will be a bad thing for VR
- The Oculus founder shared his thoughts on social media
- This writer doesn't share his optimism, unfortunately
We’re still reeling from Meta closing down multiple first-party VR software studios, but at a time when it feels like VR is on a serious downswing, some are choosing to look on the bright side and argue that this is, in fact, a good thing for the industry.
A prominent voice in that crowd is Palmer Luckey, the founder of Oculus VR, who later established military contractor Anduril Industries after being let go by Facebook in 2017 following its acquisition of Oculus. He took to social media to assert that the layoffs are “Not a disaster.”
Luckey elaborated, stating, “I think this is a good decision, and I thought the same back when I was still at Oculus.” He explained that “Every developer, big and small, even the hyper-efficient ones, have had an extremely hard time competing with games developed by Meta-owned teams with budgets and teams that spend vastly in excess of earning potential.”
I have an opinion on the Meta layoffs that is contrary to most of the VR industry and much of the media, but strongly held. This is not a disaster. They still employ the largest team working on VR by about an order of magnitude. Nobody else is even close. The "Meta is…January 19, 2026
Luckey is not the first to highlight these issues with Meta’s strategy. The company has been investing heavily in VR, creating a one-party system that many other developers, both on the hardware and software sides, cannot compete with.
Why buy anything other than a Meta Quest headset when it offers the best software support and hardware for the price?
However, when it comes to the Quest ecosystem specifically, the games produced by these studios were hardly “crowding out the rest of the entire ecosystem,” as Luckey put it. One or two VR games a year from Meta itself aren’t overshadowing the multitude of amazing VR games and apps available. Yet, the influx of Horizon Worlds and free software is clogging up prime spots in the Meta Store, and many developers have voiced concerns about this, as reported by UploadVR.
While free-to-play titles may keep some users engaged, major attractions are what draw people in—especially recognizable IPs like Batman: Arkham Shadow or Marvel’s Deadpool VR. However, with VR still in its early stages, significant investment is required to develop these flagship titles.
Now, without those teams creating recognizable franchises that entice users to explore VR, I foresee a decline in VR’s popularity.
Moreover, from a hardware perspective, Meta has also discontinued its third-party HorizonOS headsets, which could have helped diversify the VR landscape.
While I can understand the silver linings that some, like Luckey, are seeing, the broader picture reveals dark clouds looming ahead.
A move in a new direction, or more missteps?
This also does not take into account the smart glasses aspect of Meta's strategy, and how the VR expertise it just lost could have been crucial for its alternative XR future.
With display glasses poised to become the next big thing, Meta will need content for its smart specs, and games and fitness apps will be essential, just as they were in VR.
Imagine having a virtual Supernatural coach guiding you through a workout in your local park in AR, or an IRL AR multiplayer game developed using the spatial computing expertise of the studios Meta just closed.
In this context, this move seems ill-advised.
Meta has made several missteps with the Quest headsets, but it has also achieved significant successes. However, essential services like productivity and entertainment have lagged behind compared to smart glasses competitors.
It appears that Meta is shifting its focus away from VR, and unlike Luckey, I don’t believe this is beneficial for the industry. I hope I’m mistaken, but the more I consider the broader landscape—especially the rise of glasses over headsets—the more I feel this could signal a downturn for VR, potentially leading to a prolonged period of stagnation.
Perhaps I’m wrong. There are still many excellent third-party VR developers, and with the Steam Frame set to launch later this year, they may keep the momentum going. However, my optimism is waning.