What This Year’s Sundance Festival Tells Us About The Future of VR
VR had a strong showing and received a record-high deal, but its path toward mainstream adoption remains unclear
It is no secret that VR films and experiences are quickly becoming a staple at major film festivals, as more and more filmmakers and content creators start to explore this immersive storytelling format. Held over the last weekend, the renowned Sundance Film Festival was no exception with twenty VR projects (give or take one or two “mixed reality” ones, depending on how you want to categorize them) featured in its forward-looking New Frontier program.
What Sundance Showcased
A big milestone headline coming out of the festival this year was that Spheres, a VR-in-space experience described as “part astronomy lesson and part art project,” was acquired by a VR funding firm and distributor called CityLights in a 7-figure deal. VRScout reports that the exact number is in the realm of $1.4 million, which is a standard price for buzzy indie feature films at Sundance, but previously unheard of for VR projects.
This record-high sale indicates that there are still substantial investment interests in virtual reality as a storytelling medium, despite lackluster consumer demand and slow user adoption. According to data from eMarketer, only 22.4 million U.S. consumers (about 6.9% of total U.S. population) have consumed VR content on a regular basis in 2017. CityLights is no doubt making a gamble here that Spheres can find a route to profitability, and players in the VR content space will certainly be watching if the 3-part series will be able to capture a sizeable audience once it’s released on Oculus Rift this summer.
However, going through the rest of VR projects showcased at Sundance this year, nothing seems like a particular standout at first glance. About half of the VR lineup, such as Wolves in the Walls, Dinner Party, and Dispatch, plays in the mystery/thriller genre that has become standard fare in VR content, while the other half mostly consists of VR documentaries that aim to leverage the empathetic power of the medium to let viewers step into the protagonist’s shoes, similar to what publishers like New York Times had done with their journalistic VR projects.
Among the few VR games on display at Sundance, Chorus is noteworthy for adding a social element to VR content, as it allows six players to band together as fantastical female warriors to battle evil monsters. Although its demanding requirement for hardware setup poses some challenges in reaching a wider audience. Outside Sundance, The Inpatient, a choose-your-adventure thriller released last week exclusively on PlayStation VR, is gaining critical claim and climbing the bestseller charts.
A Reality Check For VR
Despite the creativity showcased by VR filmmakers and the moderate success of a handful of VR games, none of them really offer much insight on where VR is heading and, more importantly how the medium will break into the mainstream consumer market. Even with the innovative content and games that have popped up in the VR space over the past few years, user adoption is still happening at a painfully slow pace.
According to the latest data from eMarketer, only 6.9% of U.S. consumers view VR content on a monthly basis. Although that number is projected to grow to 11.1% of all U.S. consumers, it is still less than half of the 88.1 million console gamers (about 26.8% of the total population) in the U.S. And with over 75% of video gamers expressing no particular interest in VR games, according to a 2016 Sequence study, as well as a declining interest in VR among game developers, it seems safe to say that gaming may not be the mainstream breakthrough as many have thought, at least for now.
As for the narrative-driven, non-gaming content, the market isn’t any easier to break into. Oculus shut down Story Studio, its internal VR production unit, last May mostly due to weak demand for VR content. VR experiences are meant to fill the same space that many other forms of visual entertainment already occupy, and in the world of Peak TV and 24/7 news cycle, narrative VR is having a difficult time winning over a mass audience due to the high level of commitment it demands. And it’s not just commitment in buying the pricey hardware and putting in the effort to set things up — although that alone is enough to dissuade most consumers — it is also VR’s unique demand of absolute full attention that runs counterintuitive to a generation of audience that has become accustomed to the second-screen experience and multitasking while consuming entertainment content.
Luckily, the first pain point may be alleviated soon as VR continues to untether from computers and phones with wireless-capable headsets like HTC Vive Pro and affordable all-in-one devices such as Oculus Go coming out later this year. According to BI Intelligence, 1.5 million standalone VR headsets are estimated to ship in 2018. In contrast, the attention commitment is a mental barrier that viewers will likely have a harder time overcoming, especially when it comes to long-form content.
Until now, the development of VR content has been fairly concentrated in gaming and entertainment, But if games and narrative-driven experiences are likely not enough to push VR into the mainstream spotlight, then where could VR’s breakthrough be?
Alternatives for VR’s Mainstream Breakthrough
Considering the main obstacles hindering VR from gaining mainstream prominence, namely the lack of marquee content that can draw in skeptical and ambivalent viewers and the difficulty in convincing viewers to fully commit and pay undivided attention, the following two domains may prove to be suitable alternative to propel VR content into mainstream adoption, although each does come with a caveat that needs to be addressed.
First up, sports seem like an obvious choice for VR with its passionate built-in fan base and a sprawling, high-quality content library. In fact, major league owners from the NBA to the MLB have already been experimenting with VR content to bring immersive viewings to fans watching at home. Later this month, NBC is set to produce more than 50 hours of live VR coverage for the upcoming Winter Olympics, which will be made available across all major VR platforms. However, sport events content poses a unique demand for live viewing, and live VR broadcasting is still in its early stages and prone to lags and subpar viewing experiences caused by production restraints.
Then there is education and training, in which VR is only starting to gain momentum. By immersing students and trainees in VR, the learning experience will hopefully become more direct, interactive, and impactful. Microsoft has established a program to introduce its ‘mixed reality” headsets into classrooms as a visualization tool, and Lenovo also unveiled a Classroom Kit for its new Daydream headset intended for taking students on VR field trips. On the training side, VR has infiltrated Olympic training, and companies like KFC, UPS, and Walmart are all using VR as an employee training tool.
Education and training naturally demand the full attention of the participants, which removes the aforementioned mental barrier of commitment. And the hype around Spheres shows that a piece of educational VR content can be compelling and even entertaining too. However, the big question remains whether students and trainees would be impressed by the magic of VR to the point of wanting to try it beyond educational contexts, and that would be influenced by many other factors as well.
At the end of the day, VR simply doesn’t fit neatly into pre-existing distribution channels, and that makes it quite inaccessible for most consumers. To remedy that, the headsets will need to get better and cheaper, the content more diverse and compelling, and the platforms less fragmented. Until then, VR’s path towards mainstream adoption remains unclear, which means that for now, brands should perhaps look elsewhere (hint: augmented reality) to build out their immersive content offerings.
