Virtual Reality and Augmented Reality: the Road Traveled and the Road Ahead

Guest Post originally published on the Canadian Media Fund’s Trends blog

Virtual reality (VR) and augmented reality (AR) have been the object of some impressive developments in the past 12 months. Here’s what to watch out for as new headsets and technologies are commercialized to make VR and AR content more accessible.

These are exciting times for VR and AR. Several key developments and announcements have followed in the wake of the acquisition of VR technology company Oculus by Facebook in March 2014. This acquisition served as a wake-up call to many: VR was back and a real industry was in the making. In the last year alone, VR has leapt out of the gaming niche and been rapidly embraced by the film and marketing industries. New AR hardware capitalized on Google Glass’ early mainstream introduction.

Here’s a closer look at these latest developments:

Based on VR hardware announcements as well as those from the film and TV industries, here are a few paths to consider for VR and AR over the next 12–24 months:

1. Cinematic-quality VR remains a nascent industry with only a handful of outfits able to produce 3D content.

Major studios have signaled their interest in using VR as a promotional tool as was done for Interstellar and Insurgent. A handful of forward-looking producers such as Banshee’s Greg Yaitanes have introduced VR content related to major shows. The attendance success of the recent VRLA SpringExpo shows that the interest for cinematic VR is growing. Nevertheless, 3D cinematic VR content production currently entails a rather cumbersome and complex process, mastered by only a limited number of production companies. In addition to JauntVR’s solutions, more production and post-production tools will be developed.

There’s a need to build industry-grade production and post-production solutions to enable visual creators to harness the VR medium. Oculus, Samsung and HTC are all rolling out and updating SDKs (software development kits) to allow developers to create apps for their headsets. It can be expected that these SDKs will feature content development tools at some point. Game engine Unity3D, which launched its Unity 5 version on March 3, 2015, is also working to develop tools to help VR video creators through its presence in Montreal. These solutions should allow a greater number of production companies and creators to undertake cinematic VR.

VR headset manufacturers clearly recognize content as one of the main drivers to accelerate VR’s marketability. In a new market, it is important to make content easily discoverable. This is an area that requires a lot of work, as there are currently a very limited number of content discovery methods and aggregation/curation initiatives out there. NYC-based start-up eevo announced that it has raised US$1M to build the “Netflix for VR.”

Paired with discovery is distribution and monetization. Oculus and Samsung have started to put together the elements to build VR app stores and content. The onboarding of users on these monetization platforms will be an essential ingredient to the value chain. Consequently, financing VR content will remain a work in progress and VR experiences and films will need to be creative to raise funds.

2. Oculus-like VR headsets will be shadowed by AR headsets and low-tech mobile-centric headsets, the latter having greater mainstream market potential.

The jury is still out on the actual number of Oculus-like headsets that consumers will buy in the next 18 months. Oculus itself has been delaying the commercial release of its headset. Samsung, with its Gear VR headset that is paired with Samsung smartphones, is the first to market a mainstream-focused product. Sony’s Morpheus should be next, followed by HTC’s Valve. The as yet unknown parameter is the pricing and customer reaction to the non-mobile headsets, which require more recent computers to function properly.

The interesting and possibly unpredicted development has been in the low-tech headsets sector. Google Cardboard’s VR app has been downloaded between 1 and 5 million times via the Android Play store. Samsung’s mobile-centric Gear VR has also inspired famed optical company Carl Zeiss to roll out its Zeiss VR One, priced at US$120. It is safe to assume that pricing and portability are going to make these smartphone-enhancing headsets the most attractive option on the market.

Augmented Reality headsets such as Microsoft’s Hololens will be an interesting counter to Google Glass. Its commercial roll-out could accelerate the development of AR applications as well as AR content. Microsoft is betting that augmented reality will be a more mainstream-friendly medium, and it could very well be right. Virtual reality headsets isolate users from the physical world, but augmented reality adds to it in possibly very useful applications.

3. Non-headset VR and AR will start to be a reality.

My personal take on VR is that headsets are not the end game but just the beginning. The next 2 years will see the development of non-headset VR technology which is already exists in the form of museum installations and top-of-line training/simulation. Moore’s law surely applies to this technology and already Barco’s top-of-line immersive spaces and VR training have inspired companies such as Catopsys. Its Immersis project is rolling out AR projectors that transform a room into a shared projection space. Think of Spike Jonze’s HER as a sign of where this is heading.

A very exciting potential development is the ability — through these immersive spaces — to create a network of new third spaces, reminiscent of community movie theaters that have for the most part disappeared. These locations, a combination of cafés and exhibition spaces, make sense for both consumers and content producers. They could bloom into an alternative distribution network for VR/AR content and also serve as community movie theaters for the projection of traditional content.

VR and AR are exciting fields and burgeoning industries that will need to foster a symbiotic relationship between technology and content. The jury is still out on the timeline for both technologies to go fully mainstream. VR headset sales numbers which will be analyzed after Christmas 2015 will represent an important milestone.