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This VR cycle is dead


Millions of Americans donned a wacky-looking headset to get a glimpse of a different reality this week.

No, not a virtual reality headset — these people were looking up at the sky through protective goggles to witness a total eclipse of the sun which cut a shadowy swathe across middle America.

And while some 160 million Americans were intending (said CNN) to watch the rarely-glimpsed solar spectacle in some shape or fashion, be it in person donning protective glasses (hopefully), or casting shadows through pinholes pierced in cardboard, or eyeing TV commentary, or via one of the many eclipse livestreams available online, the VR industry could only stand on the sidelines and marvel at such impressive viewing figures.

Because virtual reality is having a moment — a bad one, not basking in any much sun.

At this year’s E3 — aka the biggest date in the gaming industry calendar, known under its full title as the Electronic Entertainment Expo — there was an Oculus-shaped rift where the Oculus-shaped Rift should have been showing off its vision of the future of electronic gaming and entertainment.

Now HTC, maker of the Vive VR headset in content partnership with storied games publisher Valve, has moved to slash $200 off the price-tag of its VR kit — responding to Facebook-owned Oculus putting the Rift on a price crash summer sale, down to $399. (It intends to raise this again at the end of summer but only slightly, to $499.)

It seems unlikely the pair were slashing prices because potential customers might be too busily distracted by the looming total eclipse of the actual sun to think about buying into virtual reality.

As TechCrunch’s Lucus Matney noted: “Over the past several months it’s become clear that the war is no longer HTC and Oculus trying to discover who is Betamax and who is VHS, now they’re just trying to ensure that high-end VR doesn’t turn out to be LaserDisc. Though few of the big players are keen to readily admit it, many investors and analysts have been less than thrilled with the pace of headset sales over the past year.”

The bald fact that neither HTC nor Facebook/Oculus has released sales figures for their respective VR headsets speaks volumes. (Analyst estimates aren’t generous, suggesting <500k units apiece.)

Sony did put out some sales figures for its Playstation VR headset in February which caused some initial excitement — with the company claiming 915,000 units sold since October 2016.

But by June that figure had merely drifted past 1M.

Maybe summer just isn’t the season for VR.

Going to the beach to take selfies to put on Instagram > virtual reality.

Coming down

In its 2017 Hype Cycle for Emerging Technologies report, analyst Gartner positions VR rising up its “slope of enlightenment” — which, visually speaking, looks over generous.

Although really it just suggests VR has lost the power to disappoint quite so acutely — exactly because it’s already done so, having plunged from the lofty pinnacle of over-inflated expectations to smash into the grounding reality-check of slender consumer appetite for what the tech can actually deliver right now vs a still lofty price.

That gentle slope stretching in front of VR offers cold near-term comfort; it translates into looming years of long hard slog.

Even if the lowest, most disappointing doldrums now lie behind VR, as Gartner reckons, talking to erstwhile VR enthusiasts, it’s clear that near-term enthusiasm for the tech is in short supply.

Gartner’s positioning gives VR a two- to five-year timeframe for achieving the hoped-for jackpot of mainstream adoption. The latter end of that guestimate seems more realistic to my eye.

Meanwhile, the alternative notion that VR might actually be a niche — rather than mainstream — tech doesn’t seem too far-fetched at all.

Time will tell.

Another VR cycle certainly feels dead in the water, if not completely sunk.

One bullish entrepreneur I spoke to recently on this topic conjured a future for VR in the centre of the living room, with TV screens replaced by pairs of VR glasses able to shutter between real and virtual views.

He said he could imagine himself and his girlfriend sitting side by side on the sofa watching a movie through their respective lenses.

It’s a thought — if a strange one.

I mean, how would you exchange raised eyebrows and knowing glances with your S.O. if you’re both blinkered by a wearable? Such headsets would have to be very lightweight indeed — essentially a standard pair of glasses yet able to switch dynamically and intelligently between digital and real world views, say fading up your companion’s face when you turn toward them so you can try and catch their eye.

Frankly, if the tech can’t be playful it just won’t be functional.

But of course, as it stands, VR hardware isn’t anywhere near engineering such slickly futuristic and socially acceptable feats.

Nor have we glimpsed, IRL, Magic Leap’s much hyped, years-in-the-making apparently-reality-bending goggles.

But even setting these most moonshot-y visions aside, the reality of current VR hardware and software isn’t even meeting rougher-and-readier early adopter expectations.

And that’s a big failure.

Once again, hype has been allowed to lead — and first movers who shelled out to play in nascent virtual spaces are left feeling burnt or bummed. (As one TC colleague poetically put it: “VR headsets litter my office like the skulls of ancient enemies.”)

Another story: Last year I met a filmmaker and video producer who raved about VR as if he’d just had an out-of-body experience. He ranked himself 100% converted. He explained how, the evening before, he’d donned a headset in a room full of guys and stepped inside his first VR music video.

When the video was done thumping its bass-beats into and around his body, he immediately reset the thing for a second go.

He was certain that VR was the next Big Thing. And said he planned to immediately start acquiring the skills and tools needed for his business to be able to offer VR content — to be ready for the expected tsunami of consumer demand.

Why was he so convinced about VR? He said it was because of the feeling of immersion. What about feeling immersed when you watch a film or go to the theatre to see a play?

An argument between convert and sceptic wound on for over an hour.

Several days after this conversation, he sent me a tentative message of confession: “I went to the theatre the other day — I felt immersed.”

No essential content

One veteran games industry developer who works for a top tier games publisher — including advising on the platforms the company should support — and who previously took an early interest in Oculus and VR in general; excited to experiment and bullish on its prospects back then, now tells me flatly when I ask about the current status of VR: “Come back in five years.”

Here’s what else he has to say:

It feels like the second-wave bubble of VR is about to burst.

The technology is incredibly exciting, and it has the potential to be huge one day. Unfortunately neither the hardware nor the software is ready for that yet.

I was very excited when I first played with the Oculus DK2 — the technology was limited, but you could already see what the ambition was. The hardware has increased iteratively; but you need an incredible amount of horsepower and very well optimised low-latency engine to drive VR. Neither Unreal nor Unity are particularly well optimised… The big players who have the tech that could make a difference don’t see the demographics on VR yet, and the people won’t buy it without the killer apps.

It’s like Nintendo made a cool new console with an innovative new hardware feature; but they sacked Miyamoto and their software department and forgot to make any games. VR is badly missing essential content. Oculus have failed to deliver here, despite putting Jason Rubin in charge and throwing around a bunch of money.

Sony’s device is slicker, but underpowered and incapable of even delivering PS4 level graphics let alone surpassing them.

The harsh truth is you really need $1,000 of kit to deliver modern AAA experiences in VR, and people don’t want to spend that, they don’t want to wear it, and they hate the cables and the clunkiness.

We are not only seeing low hardware sales, but attach rates are terrible. Even owners of VR hardware are not buying software (at least not in the quantities needed to fund large games), and this is further limiting how it is growing.

It’s clear that VR needs the equivalent of a Nintendo ‘power brand’ — with existing beloved character caché — to be generously deployed as fuel to light up a network that simply isn’t there yet.

It’s the classic chicken and egg problem.

Job Simulator may be a cute game for a few minutes of virtual soft play but it isn’t going to compel the vast masses to shell out and wire in.

Playing at virtual office work in VR game, Job Simulator

Meanwhile a hugely popular gaming franchise like Minecraft, which might on the surface seem a good theoretical fit for VR, has nonetheless been hampered by the tech’s nausea problem.

Turns out roaming and spinning around inside a fully immersive 3D block-mining world can make you feel sick as a dog.

(Incidentally, this does not surprise me in the least; I had to abandon Minecraft on a 2D screen after getting motion sickness from just a faux 3D-perspective. Full VR Minecraft? Frankly you couldn’t pay me to play that.)

But there’s another content-related problem too.

With an ongoing lack of “essential” — and perhaps we should add viably vomit-free — content, there’s a wider risk that VR is already being slow-branded a loser.

Something that, when you put on its geeky uniform, clings to you unpleasantly, like a queasiness you can’t shake — with an unmistakeable whiff of stale sweat and a vague and depressing feeling of failure.

Much like the carpets in early 2000s VHS video rental stores, the state of the VR ecosystem is already telling a story.

Meanwhile VR’s few available virtual spaces are left to be largely appropriated by the marginal few — as playgrounds for their memes, their in-jokes and other seedier elements and even more unpleasant acts  — further risking what VR is perceived as being. (And who it is perceived as being for.)

VR risks becoming Second Life in immersive redux — after which it will only remain for articles to be penned telling the strange fable of ‘How an early dot-com 3D world predicted the fringe failure of modern VR.’

Ecosystem neglect being allowed to metastasize is a real risk for VR at the end of another cycle.

VR =/= AR

Right now we can certainly confirm VR’s laundry-list of linked problems: Underpowered, expensive and awkward hardware that hasn’t sold well, saddling and saddled with a paucity of compelling content which isn’t engaging even its keenest early adopters.

The popular high point for VR so far has probably come via low budget mobile VR — aka, cheap and cheerful headsets such as the Samsung Gear VR or Google’s fold-it-yourself Cardboard which lets smartphone owners repurpose their mobile as a basic (so underpowered) virtual reality viewer by slotting it into a frame.

But even in mobile VR, sales of headsets aren’t exactly overwhelming. And the gizmo is clearly more gimmicky accessory than truly necessary.

It’s also hard to overlook the fact that mobile VR’s pinnacle moment of PR exposure managed to deliver the single most dystopian tech image of 2016 (IMO) — as Facebook founder Mark Zuckerberg was photographed striding down a conference aisle wearing a rictus grin, while, alongside him, a roomful of men were apparently oblivious to his presence because they were all headsetted and wired in…

Facebook’s CEO Mark Zuckerberg arriving at a Samsung mobile VR event in early 2016

The stereotypically downturned slack mouth of the VR headset wearer, mobile or otherwise, most often appears as a gormless gape in photographs. This is in no small part because the headset baffles entirely that most subtle and sophisticated human communication tool: the eyes.

It seems possible that a mixed reality wearable, small enough and light enough to house the necessary tech within a standard pair of glasses — and which also manages not to obscure the wearer’s vision nor distort their facial appearance — could avoid such a problem.

Although the awkward lesson of Google Glass (“Glassholes”) underlines that overtly geeky pairs of glasses will still be roundly rejected — however comfortable they might feel in self-selecting technobubble corners of Silicon Valley…

Interestingly though, and at least for now, mobile AR has shown it can integrate successfully as a social technology without the need for any kind of headset or wearable — just utilizing the various apps that already exist for viewing and sharing augmented content on smartphones.

Whether it’s a Snapchat selfie lense or style transfer applied to a Facebook live video or some other AI-powered face-altering photo processing app.

People are very happy to play around with how they look in order to express how they feel — and also happy to do so because they don’t have to journey to some other, purely virtual space to do so. They can remain in control.

Snapchat’s face-morphing selfie lenses

Mobile AR lets people change their spots and stripes, or see something novel and different without having to abandon their personal and social context entirely. Nor do they have to make themselves vulnerable in the process by giving up their peripheral vision. That’s very powerful.

This type of mobile augmented reality doesn’t force users to become or to feel anti-social. Its community of users retain their anchoring context, and can play within their existing social groups.

A tourist plays Nintendo’s Pokemon Go mobile AR game in front of the Eiffel tower in Paris, France, on September 8, 2016  (Credit: Chesnot/Getty Images)

Indeed, mobile AR is often inherently social. It encourages more and greater visual communication — just by giving people tools to create and share visuals that are part familiar, part fantastical.

While they can appear to be some overlap with VR, it’s really not the same kettle of fish at all.

AR is most often a social and expressive medium (though it can also be a utility); whereas VR’s big promise and pull is total escapism and the resulting ‘immersive’ entertainment value (with some potential use-cases for education/training) — though that of course means VR is having to compete for attention with existing entertainment powerhouse media, be it cinema, videogames or Netflix.

It should be clear by now that blending digital content with actual goings on in the real world opens up all sorts of functional and social opportunities that simply aren’t half so possible or accessible in VR — for all its powerful, clever underlying tech and graphical polish.

Yes there is the notion of ‘social VR’ — such as the below pictured Facebook Spaces, a still-in-beta concept platform for Oculus users to ‘socialize virtually’. Think of it as a sort of VR version of the 3D Playstation Home social gaming platform.

Hanging out with friends virtually in Facebook Spaces

But no it’s not equivalent as you’re still required to ‘exist’ in a controlled elsewhere, beyond and/or outside your normal social spaces (where, it goes without saying, only, at best, a sub-set of your friends will also want to be).

In Facebook Spaces users are represented in an avatar form that, regardless of how much engineering attention is undoubtedly being paid to making hair swish and eyes crinkle, nonetheless come across as cartoonish and clunky vs, y’know, the actual human body with its rich and subtle physical language.

And sure AR may never provide the kind of ‘out-of-body’ immersiveness that can generate such inaugural awe among first-time testers of VR. (Although Pokemon Go players may disagree.) But mixed reality as a technology is demonstrably more accessible and therefore more useful.

And because it’s more social it follows that it has greater mass market potential.

You don’t have to look far to see mobile AR already demonstrably generating massive demand…

Crowds of people at a Pokemon Go meet-up

Beyond Nintendo’s brand caché, and beyond app crazes like Snapchat lenses, you could even argue that groups of friends socializing in person and carrying on conversations while simultaneously holding and using their smartphones — to view and flip through content feeds and snap and share photos simultaneous to having real-life interactions — is a rudimentary form of mobile AR.

Because they’re blending their offline and online lives in quasi-real-time. (This is perhaps the best argument for, eventually, some kind of mobile AR wearable — i.e. to lift eyes back off screens and onto actual faces.)

It’s a modern social scene that’s being played out in physical social spaces all over the world right now. And it’s being achieved with just smartphone screens, camera lenses plus a bunch of social/messaging and sfx/image-augmenting apps. Additional dedicated hardware tools haven’t been necessary (yet).

Meanwhile VR’s expensive weaponry lies gathering dust in early adopters’ homes, and the tech’s vested backers are facing years in the sloping wilderness. Enlightenment, if it comes, will be eventual.

Come back in five years

Yes, this VR cycle is dead.

The VR industry has to hope this is only another cycle. And that another opportunity to build a viable ecosystem will come winging in again — in five or so years. Though as what?

Perhaps a new cinema technology enabling fans to pay a premium to sit in a special type of movie theatre seat, pull down a visor and feel as if they’re occupying the body of their favorite actor in the movie. Heightened escapism for a few hedonistic minutes.

In-flight entertainment could present another bounded entertainment possibility. And there’s potential for education and training scenarios, and even rehabilitation and health use-cases, as we’ve already seen. And of course, there’s always VR porn.

But none of these segments and slivers suggests virtual reality is the next computing paradigm. (Even Facebook’s Zuckerberg now talks in terms of needing a decade before VR can realize its “full potential”.)

Occasional training tool and/or the future of high end entertainment — just possibly. But, hey, no one likes to feel sick at the movies. Feeling like you want to barf is only a good use of your time and energy if you’ve eaten something that might otherwise kill you.

The wider question in the gaming space, which excels at entertainment and escapism, remains how big VR might get when the hardware isn’t so pricey and clunky, and when investing time and energy in building compelling content can start to look like less of a sinkhole prospect for developers who can now be seen pulling their horns in.

These same types of content makers may well be having their heads turned by the potential of AR gaming. Which can, as noted above, already point to the existence of essential content generating wild excitement among millions of consumers.

Rather like the solar eclipse, AR has been shown turning masses of heads and even gathering huge crowds of like-minded folks together in public.

For now there is simply no argument: AR > VR.

And increasing momentum behind AR also risks being another depression point for VR.

Earlier this week Jason Toff, Google VR’s creativity product lead, tweeted out what might be construed as a throwaway Twitter poll — asking which industry will have a bigger market capitalization in five years’ time: VR/AR or cannabis (which has been legalized for recreational use in some US states).

The poll concluded with cannabis winning the vote, 70: 30

The poll’s bundling of VR with AR wasn’t really fair — and you can argue VR’s performance here is probably being artificially inflated by AR’s rising store. Because even if the AR/VR line is being blurred, these technologies have not converged — if indeed they ever successfully can.

Only one is trying to sell users on an entirely escapist virtual reality. So, in some senses, bundling VR with weed might have been a more accurate pairing for Toff to offer.

(For the record, in our TC Convo thread on this topic, there was general agreement that AR>Weed>VR .)

 

Last word

As a human, it’s fair to say there are many ways to induce and experience an altered state or mood, or otherwise engineer a shift in your perspective — whether your tool of choice is smoking weed, reading a great book, drinking with friends or, indeed, pulling on a VR headset and being transported to the surface of a strange and alien world.

So far, though, virtual reality has to take the inglorious award for being among the least popular of humanity’s myriad entertainment tools — with no prospect of any change on the horizon.

As it happens, another total solar eclipse is due to pass over the US in a little over five years’ time — in April 2024. It’s funny to think that the people donning protective goggles and looking up at the sky then probably still won’t know for sure if VR will ever be able to eclipse its disappointing shadow.

Hattip to TechCrunch’s Romain Dillet for the headline, and Bryce Durbin for the original artwork



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