Why is VR important for tech companies? — It’s a battle for next generation of computing platform.
Smartphones are one of the most successful technological inventions of past decade. The mobile ecosystem has created a whole new platform for applications, media, and online consumption. The result? Apple has become the most valuable company in the world. However, analysts believe the smartphone market is close to full saturation [1] and major tech companies can see this coming. This realization and need for growth is forcing the tech giants to seek new markets. And beyond smartphone screens, now companies are looking into a new media that is richer than ever. They are looking to Virtual Reality.
Today’s major technology companies have been around for more than 20 years and know the key to success in the technology market is to move fast. Here are just a few examples of why they are all being proactive when it comes to immersive computing platform.
Microsoft
As for Microsoft, you may recall Windows Mobile and Windows Live. Microsoft saw opportunities in both the smartphone and social network market. Despite being one of the earliest players in the market, Microsoft failed to win market share in both markets. This was a major missed opportunity for the PC-giant. Now they are looking to try again with VR/AR. Efforts include Windows Mix Reality, Hololens Hardware, the acquisition of AltSpaceVR and even Minecraft signal that Microsoft has a strong motivation to add to its own social network and bring 3D gaming into its own VR ecosystem.
Facebook seems to be the only player who doesn’t have a strong presence in the hardware market. Facebook has tried launching the Facebook Phone in the past, unsuccessfully. Facebook knows that to deliver the best social network experience, they cannot rely on other companies’ devices. Given the fact that launching a new product in a saturated market is not an easy task, Facebook’s decision to buy Oculus demonstrates an ambition to own a hardware product. And it has now made a big bet into a market that others have yet to dominate.
Sony
Sony is in a battle for the living room and home entertainment industry. The company pulled the trigger with the launch of PlayStation VR, knowing its biggest rival Microsoft could potentially integrate its VR ecosystem into XBox. Amongst all high-performance Desktop VR headsets, PlayStation VR has the highest number of sales thus far. And that result is not a surprise, since PlayStation VR headsets can plug-in to any existing PlayStation 4 consoles. This is in comparison to most desktop VR experiences that require users to upgrade their PC in order to use Oculus Rift and HTC Vive. However, Sony knows that Microsoft could leverage its large user-base of its XBox as well. Therefore, moving fast in this space is mandatory for Sony.
Google is experiencing a lot pressure from recent announcements from Facebook’s Oculus and Apple’s ARKit. Both company’s aim to build the platform for the next generation of developers. Android has been Google’s gatekeeper to ensure that access to Google’s services like Search, YouTube, Gmail, and its Google Developer ecosystems is not deprioritized by hardware manufacturers and other operating systems. As Facebook and Microsoft invest in VR hardware and new forms of content distribution, Google position as a software service provider to consumers and developers can be threatened.
With the potential of VR as the next major media platform, companies want to stay ahead of their competition. Whoever wins this game will control the ecosystem for VR applications and users. These companies have been through this in the past and know the large opportunity and market that awaits. But the question remains, who will win?
Our Takeaway:
Standalone VR is a Game Changer for 2018
It is well known in the industry that the PC VR market has faced slower than expected growth in consumer adoption of Virtual Reality headsets. [1, 2]. This slow adoption has been the result of two major roadblocks: expensive hardware and inconvenient set-up. Although Microsoft has promoted that its VR headsets will cost around $300 to $400, the fact remains that this headset will require tethering to a high-performance PC that costs an additional $1,000. As such, many consumers will likely continue to be turned-off by the all-in-cost of the experience and hardware requirements.
With these challenges holding back the industry, it was no surprise that both Oculus and Google have announced their standalone hardware. Ten days prior to the Windows VR debut, Oculus announced Oculus Go, its $199 standalone VR headset. This announcement demonstrated Facebook’s continued investment to make Virtual Reality mainstream, reducing the costs and cumbersome user experience the market is experiencing currently. This hardware announcement coincided with Mark Zuckerberg and Oculus’ publicly announced goal to put 1 billion people in VR [3].
Beyond hardware, a healthy ecosystem of developers is critical
No one questions that the price for high quality VR headsets will drop dramatically. With the launch of Standalone VR, $199 appears to be the new price point for Oculus Go and DayDream. This will put pressure on other VR headsets to bring their costs down and compete. However, what consumers should also look for, beyond just the hardware, is how many applications are available on the platform they are choosing.
Oculus currently has a head-start in the Standalone VR market. There are an estimated 1,500 applications on the Oculus Gear VR market today, and since all existing Gear VR apps will be available on Oculus Go, this new platform will have an immediate leg up.
Behind Oculus, only Google has launched a major platform that will also be used in the Standalone VR market. However, the number of DayDream apps is still quite limited. It will be interesting to see how many more apps Google can push its developer ecosystem to create in this next year, as this will directly correlate with which platform becomes a better experience for consumers. For Microsoft, Steam VR, and Sony, none of these players currently have a platform for mobile VR today.
Since Desktop VR apps require a different set of controllers and hardware specification, porting Desktop VR apps into the standalone VR app market will prove more difficult. As a result, the top platforms for Standalone VR headsets will be Oculus and DayDream remain.
2018 Outlook: Oculus and Google are ready to capture the opportunity.
As the battle for the immersive computing market continues to rage between the major technology giants, it is clear that this will not be a winner take all market; however, there are some platforms that are much better positioned to capture the lion share of the growing opportunity.
Given the costs and hardware restrictions that exist today, there is no doubt that the Standalone VR platforms will mark a turning point for consumer adoption of this new medium. And with the need for a healthy app ecosystem to create a strong consumer value proposition, it appears as though Facebook and Google are well positioned to continue to extend their hold on the consumer internet market.
Author: Brad Phaisan, CEO of OmniVirt
About OmniVirt: OmniVirt is leading 360° Video and Virtual Reality advertising platform that distributes 360° VR advertisements.
Read more about OmniVirt’s VR advertising / marketing products at www.omnivirt.com. Contact: contact@omnivirt.com
