Welcome to the New Shacknews

You're currently viewing the beginning of a full site renovation for Shacknews.com. You might find something working oddly. If you do, let us know! More exciting new features to follow.

One Year of VR, and it isn't Dead Yet!

Shacknews CEO and Chief VR Evangelist, Asif Khan, takes a look at the virtual reality landscape one year after the Vive and Rift shipped.

49

VR isn't dead. Pundits, tech reporters, and financial analysts have spent the last few years declaring virtual reality dead on arrival, but VR has not died. Virtual reality as a medium is healthier than it has ever been, but it still faces plenty of headwinds going forward.

The Cult of VR

Virtual reality is still a tiny segment of consumer electronics, but it also has its most fervent supporters. This era for VR reminds me of the early days of PC gaming in the 80s and 90s. It is even similar to the Mac faithful who kept Apple alive in the 90's as the company struggled to innovate without Steve Jobs. VR has its evangelists today. I definitely identify as one, myself. VR enthusiasts believe in the medium so much that we refuse to entertain the idea that it could fail. It is this blind faith that has lead me to describe it as a cult. Look at how Facebook views VR. They have yet to show a profit on the Oculus subsidiary, but they simply don't care. VR's success in the long-term is clearly more important to the company than short-term financial results. 

You Need A Killer App

A common refrain from VR's critics is that VR lacks a "killer app" that will move hardware. A year into this current head-mounted display product cycle, I think it is pretty clear that there is not just one thing that will sell these devices. There are immersive passive and more traditional gaming experiences that have created two markets for VR software. NextVR has done a great job of proving the value of virtual reality by putting customers on the sidelines of basketball games and creating a new way to enjoy spectator sports. At the same time, Resident Evil 7 has scared and delighted PSVR customers on the PlayStation 4. Neither one of those producrts are doing the same sales numbers as Angry Birds on mobile, but they highlight that VR customers are being drawn into the medium for a number of reasons. It seems that the comparison to mobile will be apt in the long run, as the utility of the smartphone can't be pinned down to one app. It is the vast array of applications that make smartphones great for users and, over time, VR software should be able offer a similar value to HMD owners. 

Developers! Developers! Developers!

Independent developers have been driving this new resurgence in virtual reality. Many of the established game publishers are sitting on the sidelines because the addressable market is too small to make a dent on their billion dollar bottom lines. This has left the door wide open for small teams like Owlchemy Labs, creators of Job Simulator, to take full advantage of being first movers in virtual reality. While $10-50 million in sales may not move the needle for an established game publisher, it is life changing money for small indie teams. VR has opened the door for a new gold rush in software development and it has been amazing to see companies that started as two guys in their college dorm room turn into more respected and established brands.

About Those Sales

Facebook and HTC have yet to reveal how many HMDs they have shipped, while Sony boasted shipping 1 million PSVRs in less than 6 months. These sales numbers for tethered VR HMDS are not great and they are not going to get Activision or EA to jump on the VR bandwagon. There are also some bright spots with the lower fidelity, untethered Samsung Gear VR and Google Daydream HMDs which allow anyone with a compatible smartphone to jump into virtual reality. The total addressable market is in the low millions of VR HMDs when you combine all of these devices, and there are more coming from various competitors. While the niche market is unappealing to some larger game publishers, there is still a find opportunity for software developers to profit if they can offer experiences that are truly unique and immersive. 

VR Won't Die

Many of the obstacles impeding VR from achieving mainstream success will be addressed over time. Screen resolutions will improve, batteries will become more efficient, and processors will become even smaller and more efficient. Untethered and tethered VR HMDs will converge into one device and it is very likely that augmented reality and virtual reality headsets will also converge over time. These are the early days of these new mediums. While it is entirely possible that some companies will not make it to the finish line of that great covergence device, VR will be there. It is simply too different of an experience. VR has too many use cases that can add value to a vast array of users. We are merely witnessing the beginning of what will likely be a 30 year evolution of the head mounted display form factor. Shacknews salutes the developers and engineers who are blazing the trail for this immersive and exciting medium. 

Asif Khan is the CEO and majority shareholder of Shacknews. He began his career in video game journalism as a freelancer in 2001 for Tendobox.com. Asif is a CPA and was formerly an investment adviser representative. After much success in his own personal investments, he retired from his day job in financial services and is currently focused on new private investments. His favorite PC game of all time is Duke Nukem 3D, and he is an unapologetic fan of most things Nintendo. Asif first frequented the Shack when it was sCary's Shugashack to find all things Quake. When he is not immersed in investments or gaming he is a purveyor of fine electronic music. Asif also has an irrational love of Cleveland sports.

From The Chatty

  • reply
    April 5, 2017 7:20 PM

    Asif Khan posted a new article, One Year of VR, and it isn't Dead Yet!

    • reply
      April 5, 2017 7:34 PM

      Half Life 3 confirmed

    • reply
      April 5, 2017 7:39 PM

      Games biz has pretty much friend zoned VR.

    • reply
      April 5, 2017 8:28 PM

      It's not dead but it's not good that articles like this need to be written :(

    • reply
      April 5, 2017 8:45 PM

      It won't die, but it won't ever become mainstream and will be purely a hobbyist thing

      • reply
        April 6, 2017 1:14 AM

        Bold claim.

        • reply
          April 6, 2017 1:20 AM

          I think he is right. I can't imagine the average consumer buying into it.

          • reply
            April 6, 2017 1:23 AM

            Because they haven't tried it yet. Also a question of price.

            • reply
              April 6, 2017 1:27 AM

              Maybe, but it seems too 'antisocial'. For a lot of people media consumption is still a communal activity where people are in the same room together (even if it is girlfriend watching some bolocks on TV while boyfriend plays a DS etc). VR takes people out of that and would be a big turn off.

              • reply
                April 6, 2017 1:39 AM

                The answer is asymmetrical games and passing the headset around.

                If you are talking online, as soon as touch controllers come in, it's way more social than chatting or voice conferences and sometimes even video.

              • reply
                April 6, 2017 2:11 AM

                this is an absurdly narrow understanding of VR

                • reply
                  April 6, 2017 2:13 AM

                  Can you expand on this...

                  • reply
                    April 6, 2017 2:17 AM

                    You're thinking of traditional videogames but with a headset blocking out all other stimulus and deeming it antisocial as a result.

                    More interesting is to think about all the hype about "presence" and VR making you believe you're somewhere else applied to a shared experience where somewhere else actually means with someone else.

                    • reply
                      April 6, 2017 2:25 AM

                      It's very anti social though with people you live with, unless you're doing some sort of shared VR and we're a very very long way off that being the replacement for TV/Movie night.

                      • reply
                        April 6, 2017 3:43 AM

                        There are things that VR will do well and things that it won't. That doesn't necessarily make it antisocial.

                        • reply
                          April 6, 2017 3:50 AM

                          People wouldn't use 3D glasses because they couldn't check their phones while watching a film. To pretend the social aspect of VR isn't a factor is unrealistic.

                          • reply
                            April 6, 2017 3:59 AM

                            That sounds more like a problem with the people you're referring to than an issue with VR in and of itself. A VR headset occludes your vision of the outside world, it doesn't make you deaf or mute, nor does it preclude others from interacting with you.

                            I've owned a Rift since launch. VR has a long way to go before it's truly ready for the mainstream, but calling it antisocial just reminds me of people saying to same thing about stuff like Doom or Quake back in the 90s. It's dismissive and shortsighted.

                          • reply
                            April 6, 2017 9:08 AM

                            I got piled on for this sooooooooo hard. It is fascinating to watch the same conversation months later.

                            • reply
                              April 6, 2017 10:41 AM

                              It doesn't mean VR can't be a success but people go so overboard when they talk about it replacing the TV and such.

                              We as human beings REALLY don't like being locked into our technology it's why mobile phones are so ultra popular as mini computers.

                              • reply
                                April 6, 2017 11:42 AM

                                Yeah there's no way it's replacing traditional displays, not any time soon, anyway. I just take issue with the "it's antisocial!" nonsense.

                      • reply
                        April 6, 2017 10:54 AM

                        this can be a good thing.

                  • reply
                    April 6, 2017 2:21 AM

                    There's more to being social than being in the same room as someone (someone who you are still perfectly capable of talking to while you have a headset on, I should mention). Go play Rec Room for a bit, or use Bigscreen watch a movie with a friend across the country.

              • reply
                April 6, 2017 2:19 AM

                Couldn't even convince people to wear 3D glasses not sure how we're going to get them to wear massive sweat inducing VR helmets.

              • reply
                April 6, 2017 2:25 AM

                Yeah cutting myself off from the real world that much is the big hurdle I just cannot get over.

              • reply
                April 6, 2017 2:44 PM

                Yup, exactly. VR has its place and I'll bet will become mainstream, but it's not going to replace the TV in the livingroom.

            • reply
              April 6, 2017 1:37 AM

              No, I think it's a social question.

              Everyone's a gamer nowadays, but it happens mostly on smartphones, and no one bats an eyelash if you break out your phone in a social setting and do some casual gaming. Console and PC gaming are one step further up the "antisocial" ladder, since you have to isolate yourself to play a game. VR is the same, but squared. Not only do you isolate yourself, but you almost step out of the world. As awesome as VR is, you can't do it and not look silly.

              It will probably become mainstream for gamers eventually. I'm thinking that it mostly needs a smaller "headprint" (not much larger than regular glasses) and it needs to run acceptably on integrated graphics, or even better, directly off a phone. I'd tentatively say 2030, but 2025 wouldn't surprise me either.

              • reply
                April 6, 2017 1:41 AM

                ... with the current form factor.

                It won't look sillier than wearing shades indoors at some point. Or contacts.

                • reply
                  April 6, 2017 1:47 AM

                  Yes, I agree.

                  I think at that point it will probably be closer to AR than VR. Or it needs to have some kind of switch that you can still see the real world while playing your game when there are other people around. Contacts would be amazing for this, but that's probably still decades away.

                  As for the integrated graphics, I suppose that the next step would be to have the GPU directly built into the headset, and requiring nothing more than the processing power of a new smartphone to run the app.

            • reply
              April 6, 2017 11:00 AM

              I tried it. It just made my eyes hurt. Can spend hours in front of a screen, not VR. Was OK for sims, but TBH trackIR lets me do pretty much the same thing, without having to move my neck as far

          • reply
            April 6, 2017 4:25 AM

            I consider myself not an average consumer and was a huge fan of VR (ever since i was little kid) but it didn't do it for me, yes it was great experiencing this and it is well implemented but not many can handle it

        • reply
          April 6, 2017 1:21 AM

          Mark my words Mr Disease!

        • reply
          April 6, 2017 5:01 AM

          3d glasses nuff said. It ain't amazing enough to want that shit on your face all the time.

        • reply
          April 6, 2017 9:25 AM

          Unless the technology gets significantly better and cheaper, he's absolutely right.

          • reply
            April 6, 2017 10:33 AM

            cheaper and better is inevitable. I think he was assuming that

            • reply
              April 6, 2017 10:38 AM

              The keyword being significantly. $800 for a headset on top of an expensive computer is too much. But honestly, $600 or even $500 for a headset is still too much. I see all these people wanting to make their money back and then some on this deep investment. I just dunno if they'll be willing to get the price average gamer friendly enough.

      • reply
        April 6, 2017 9:43 AM

        They said that about PC gaming.

    • reply
      April 5, 2017 8:51 PM

      Valve is working on THREE games for VR.

      Three.

      If after valve unleashes their salvo, and they miss, we can talk about VR dying.

      • reply
        April 6, 2017 1:48 AM

        Portal 3, Left4Dead 3 and DOTA 3 confirmed.

      • reply
        April 6, 2017 4:21 AM

        This is Valve we're talking about here. Relying on Valve to release a game is like relying on the lottery for your retirement. Besides their spotty track record on finishing anything as of late, there's the age old concept of Valve Time - they might not even be done with the things until after VR is dead.

        • reply
          April 6, 2017 4:50 AM

          Ten years from now: "We're finally ready to release...Half Life 2 for VR!"

        • reply
          April 6, 2017 6:47 AM

          Well it would be pretty sad for valve to make the software and hardware design that powers the vive, and never make a single commercial game for it. (The lab is great, just not a full game by any stretch)

          If anyone is going to release a true AAA killer app, it will be valve.

    • reply
      April 5, 2017 10:11 PM

      Too

      It is simply to different

    • reply
      April 5, 2017 10:11 PM

      Great one year update

    • reply
      April 5, 2017 11:28 PM

      When people started posting here trying to sell their rifts and vives like a month after they came out, I knew VR was gonna be a huge hit

    • reply
      April 5, 2017 11:36 PM

      It makes me mad how safe everyone is being with VR. We have to take these small baby steps to maximize our purchasable party game! Or you could take a risk and embrace something and become an industry leader gather the talented people and mega crush the market.

      • reply
        April 6, 2017 1:54 AM

        Mega crush the market? What market? It's a catch 22. Can't justify the expense of developing a major VR-exclusive title, which limits the appeal of VR to cute indy experiments. That said, it looks like Valve is going to take that risk with their money hats and Vive sales to push.

    • reply
      April 6, 2017 1:05 AM

      Since VR's commercial release, I've bought a New 3DS, Switch, a PS4 Pro (despite having a regular model), and a 4K Samsung (despite being happy with my 1080p Samsung).

      If you can't get a whore like me, you might be ugly.

    • reply
      April 6, 2017 1:48 AM

      Yeah, no killer app so far, but we're getting there slowly. I wonder how Fallout 4 will do when/if they release the VR version. I would also welcome Google Earth on PS VR.

      • reply
        April 6, 2017 2:14 AM

        I would welcome PSVR on PC.

    • reply
      April 6, 2017 2:17 AM

      Be interesting if MS move into VR with todays Scorpio stuff ... although not sure anything along those lines will be mentioned today.

    • reply
      April 6, 2017 3:20 AM

      The software all looks about as interesting as iPhone games, except graphically worse.

      I need next-gen tech as well. Give me 4k display panels. Lighter, less cumbersome headset. Wireless at some point?

      Oh and don't make it require an 800 dollar device plus two 1080ti video cards.

    • reply
      April 6, 2017 4:26 AM

      My Rift CV1 sits in a box doing nothing, because the screen-door effect makes it unusable except as a novelty.

      • reply
        April 6, 2017 5:30 AM

        What's the screen door effect?

        • reply
          April 6, 2017 6:01 AM

          It's a black outline / grid around each individual pixel, basically the space in which they cannot get the pixel to light up due to size / technology constraints. This display technology effect is highlighted in VR, where low resolutions are combined with an optical zoom.

        • reply
          April 6, 2017 6:04 AM

          It's when you can see the space between the pixels on whatever display you're using. It's called the screen door effect because it looks, well, a bit like the effect you get from looking through a screen door.

          The Rift has displays that have a pixel density of 461 pixels per inch (the Vive has slightly lower density displays, but the practical difference is negligible). That's pretty good when you compare it to a modern smartphone (the iPhone 7+, for example, has a display density of 401ppi). However, with a VR headset, you're using these screens inches from your face and then using lenses to magnify them for a wider field of view and so your eyes can actually focus on them. Higher resolution displays should mitigate the effect, but those are a way off and will almost certainly require even beefier hardware than VR currently needs.

      • reply
        April 6, 2017 9:15 AM

        I don't think it's that bad at all. The resolution is a much bigger issue.

      • reply
        April 6, 2017 9:17 AM

        Huh? it's barely noticeable, more like fine-linen-effect. Definitely not something I pay attention to in games. I've had a DK1 & a DK2, the screendoor effect was always noticeable in those.

    • reply
      April 6, 2017 4:36 AM

      I think the thing that spells doom for VR is price and logistics.

      A friend of mine wanted to try the "VR thing" in the form of some football game watching thing that used Google Cardboard on his phone, but he said he looked into buying a viewer and "those cost like a hundred dollars, that's kinda expensive". I laughed and said oh man, a hundred dollars won't even get you a good headset. Things like the Oculus Rift are $600 and have to be tethered to the PC with multiple cables. The HTC Vive is $800 and requires decorating a room in your house.

      Then I looked online and saw that there's an actual cardboard Cardboard viewer at Best Buy for $10. He couldn't be bothered to go get it. So I went and got one and did the whole thing of playing with it and my iPhone. I've never used a Rift or Vive or anything like that. I thought it was a neat gimmick but it gave me a headache after a few minutes and it was jittery as hell. It didn't help that the viewer had no head strap so you had to hold it in place manually.

      But this isn't "real" VR so it doesn't really count, right? The thing is, I've seen multiple reports saying that phone-based VR is the way VR will become mainstream. Your average consumer is never going to spend 2x what a console costs to buy a headset. They might spend up to $100 on a phone dock for their head.

      If this is true then VR is doomed because the tech on phones is nice but I doubt it will ever be there enough to make good VR worthwhile. By the time a phone has a high enough resolution to put the 2k or whatever view in each eye the fad will be dead. Even if it does get there the public will see it like a ViewMaster - a toy gimmick, not a real thing.

      I dunno, I've got a couple of anecdotal points of data. I could be wrong. But I think there's billions being spent on a market that only exists in theory at the moment.

    • reply
      April 6, 2017 6:41 AM

      So far I'm still glad I've held off on purchasing. I have a feeling I'd toy with it for a dozen hours then it would collect dust.

    • reply
      April 6, 2017 6:43 AM

      I've been debating selling my Vive for a while. It's really awesome but I just don't have the time to put on the headset and wander around my room. When I get home from work, if I even have time to game, I want to veg out on my couch. If I were younger I'd probably use it a lot more. Everyone I show it to wants one and is blown away by it, and they all talk about it when I see them.

    • reply
      April 6, 2017 7:52 AM

      Price point is just way too high to play a bunch of "neat tech demos". Install base will never be high enough for studios to produce more than "neat tech demos". Sony made the accessible VR set to date and it's not exactly lighting up the charts.

      • reply
        April 6, 2017 8:10 AM

        It needs to get lighter, cheaper, sharper and wireless, and each of those requirements makes the other three harder.

      • reply
        April 6, 2017 8:15 AM

        Bethesda, Rocksteady, and Valve are all working on full games, so your second statement is already false.

        • reply
          April 6, 2017 8:27 AM

          I'm not a betting man, but if I was I would say that none of those will light a fire under the sales of VR and will ultimately end up as commercial failures for their respective developers. Either that or they will be just as playable without the VR hardware and be successful in spite of it not because of it. For instance, if Valve was to finally release HL3 and made it VR compatible it's going to sell regardless as long as it's playable without VR. It's not going to increase headset sales in any significant way.

          And yes of course this is pure speculation.

        • reply
          April 6, 2017 9:04 AM

          There is no way they're putting as much time and money into those games as Fallout 4, Batman Arkham Asylum or... okay Valve has insane money hats so maybe they're spending as much on each game as DOTA 2.

          But still, no chance they're making that insane financial bet - Valve is different because they have hardware to push and infinite money from Steam.

      • reply
        April 6, 2017 8:46 AM

        Basically VR as a concept has come around periodically for years now (anyone remember Virtuality, the company that was going to make the Atari Jaguar VR helmet? And mother fuck, the goddamn Virtual Boy) and it's always floundered and failed. And it's not because no one's tried to make it work.

        Maybe this really will be the time it succeeds. But maybe the tech just isn't there yet. Again.

        • reply
          April 6, 2017 8:49 AM

          That's what I'm thinking. It really seemed like it was ready this time, but I don't think it is. These headsets need to cost $200 or less, be wireless, run on a moderate PC or console, and be powerful enough to not have any latency issues. That's impossible at this point in time.

          • reply
            April 6, 2017 9:13 AM

            If the tech is truly compelling the things you list are not barriers to taking a foothold. Technology does not work that way.

            If it fails at this point, it's because it's just not a compelling experience. It might be neat, but not neat enough for people to bother using it regularly, thus it's really doomed for perhaps, as I said below, some quantum leap in tech, like direct brain interfacing or something.

            • reply
              April 6, 2017 9:22 AM

              But no one is going to take the chance to make a "compelling experience" if no one is buying it. Your top tier AAA game costs 10 of millions of dollars and no one is going to spend that kind of money to make an VR exclusive game. Maybe I'm wrong in thinking that if someone DID invest those resources they COULD make a compelling experience with the current hardware. Instead we're getting these low risk tech demos that aren't going to make or break a developer.

              • reply
                April 6, 2017 9:30 AM

                Someone like EA spends that money because they know they can make it back, it's proven cashflow, and there's a ton of competition in shooter and sports games so they have to stand out. If there was only one COD game we wouldn't give a shit if it looked like SuperHot. But because we have Battlefield, Titanfall, etc. that all do the same thing they have to stand out from one another. It's the available market for shooter games than causes the publishers to blow tens of millions on the games, not the other way around. Usually the first one to nail the formula isn't some massive budget project. Ex. Counterstrike was a free mod made by a handful of people as a hobby and I'd argue spawned a significant amount of that genre of game.

                Figuring out the killer app for VR is more of a question of inventiveness than money. I won't deny we could have some killer app any day, but I'm not sure you'll convince me it's going to take a massive wad of cash to make the first one.

        • reply
          April 6, 2017 9:05 AM

          The tech is there, easily. It's a matter of engineering the pieces together and working kinks out, which TBH seems to be done with figuring out things like latency, persistence, and projection. At least in the general understanding of what VR has always strived to be, all the technology required is available and working. Smaller kinks light weight and tethers aside which seem not to be deadly for a new tech, and price which is completely expected for any new tech whether it's electric cars, solar panels, microwave ovens, indoor plumbing, etc.

          Either it's compelling enough for the rich to give it a foothold and bootstrap economies of scale, or it's doomed until some other significantly more meaningful breakthrough. I.e. if we want to say this won't really work until we can solve the inertia and steady movement inner ear problems so we don't have to be limited to games were you either do not move or have to use teleporter mechanics, which we may never solve before we figure out how to plug the electronics straight into our brains.

          There's no "oh if it just had [incremental improvement]" at this point if it fails.

        • reply
          April 6, 2017 9:31 AM

          Having tried those, and the Vive, those old things aren't playing the same sport, let alone being in the same league.

          • reply
            April 6, 2017 11:22 AM

            The Virtuality things are just hilariously bad in hindsight. We're debating whether or not the tech is there in 2017, no way in hell was it anywhere near close in 1993.

            The Virtual Boy, I'm convinced, started out life as a strap-on VR helmet in concept and just got dumbed down to the red Game Boy in the dark it got relegated to.

            I agree they're not in the same league but my point was that every time his comes up people think the tech is almost there. And maybe it really is this time. But people thought that last time too.

            • reply
              April 6, 2017 11:26 AM

              I think we can agree that we are getting closer with the 2016 attempt at VR. It is not ready for prime time, but it isn't worthless.

    • reply
      April 6, 2017 10:39 AM

      It's great to have friends that have one and borrow it. Watching people experience VR for the first time is great, then ask how much money for all this, well....Um, about 2k.

    • reply
      April 6, 2017 10:51 AM

      My feeling as a PSVR owner is that VR still isn't ready for mass market. It needs to be cheaper, lighter, more comfortable, easier to use, and much higher rez. None of these problems are an easy fix. I have PSVR and I really enjoy it. I'm not even interested in racing games outside of VR after sinking hours into Dirt Rally, and RE7 proved that horror games are better in VR too, but I don't love the hardware as much as the software. Even as the easier solution it's cumbersome. I hate flailing for my controller or water in the dark, the face sweat, the nose grease....

      Vr is just a shadow of its future self right now, and when it really gets here it will change things.

    • reply
      April 6, 2017 10:59 AM

      It's not dead cause the percentage of people that bought it don't even register on anyone's scale yet.
      3D was around a lot longer and it died.
      You need about 25 years more to make this work properly and you need killer apps as well.

    • reply
      April 6, 2017 11:08 AM

      There's some fucking irony in people saying VR is never gonna be a thing, via smartphones.

    • reply
      April 6, 2017 11:21 AM

      I love VR. I'm onboard for wherever it goes in the future.

        • reply
          April 6, 2017 11:32 AM

          A few weekends ago I spent 6 hours re-routing ductwork in my basement so that I don't hit it with my Vive controllers. Somehow talked my friend into helping me too, poor bastard.

          • reply
            April 6, 2017 7:36 PM

            I thought about moving my VR space to my den which would be a very similar effective completely free area, but would have a much lower ceiling, low enough to hit with the controllers. I could have a dining room table but I'd rather have a completely clear VR space :)