Virtual Reality: Global Game Changer Or Just A Gimmick?

Ben Lee

Ben Lee

CEO and Co-founder of Neon Roots

Ben Lee is the co-founder and CEO of Neon Roots, a digital development agency with a mission to destroy the development model and rebuild it from the ground up. After a brief correspondence with Fidel Castro at age nine, Ben decided to start doing things his own way, going from busboy to club manager at a world-class nightclub before he turned 18. Since then, Ben has founded or taken a leading role in 5 businesses in everything from software development to food and entertainment.

Whether it’s the HTC Vive, the Google Cardboard, or the headset that started it all, the Oculus Rift, VR has become a hot topic for businesses and consumers alike in recent years. But while the ongoing drama of hardware development and the competition between companies looking to own the VR space has been lively, VR has yet to fulfill the mainstream potential that so many promise is around the corner.

Despite what is now wide commercial availability, anyone owning a VR headset today is an early adopter – they aren’t a widespread phenomenon. While the HTC Vive has sold an estimated 100,000 units, an impressive number, global VR device sales currently number close to 1 million – not a revelation, by any means. So – is VR just a passing fad? Or is the hype justified and the future for the technology as big as it’s played up to be?

An Uncertain Trajectory

Current sales numbers show that VR headsets aren’t a flop or failed product line, but consumers aren’t clambering to adopt them the way some analysts expected. As for the near future of VR sales, experts are severely divided and little data exists to validate opposing arguments. Market research firm Tractica estimates that as many as 20 million devices could sell and ship this year, with some 200 million selling by 2020. Others take a different view, with Immersive Technology Alliance’s Neil Schneider estimating just 300,000 units will sell by the end of the year.

In business, the picture is similarly unclear. Most of the tech giants – Facebook, Google, Samsung, Microsoft – are trying to stake their claim in VR, battling for early market adoption and innovation. Similarly, many business leaders are eager to capitalize on the new technology for its potential benefits in training employees, demoing new products, and enabling life-like design in real time. But adoption is shaky and the future is unclear, with most experts believing true mainstream adoption won’t happen for many years.

Gimmick or Game-Changer?

oculus rift virtual reality

Some call this the future of media – but is it a just a passing fad?

But despite middling sales numbers, questionable user experiences, and an uncertain future, chances are that VR isn’t some passing gimmick: it’s here to stay, and it’ll have a serious impact on how consumers and businesses use and interact with technology. Even in the current moment, things aren’t as uncertain as they may seem.

Strategy Analytics estimates that global VR sales will generate nearly a billion dollars this year, with most of the devices being lower-priced and using a smartphone as a screen. High prices for the name-brand, high-end units are keeping sales down, but as technologies improve and prices come down – keep in mind that Moore’s Law has yet to fail us – we can expect those sales numbers to grow. PWC estimates that more than a third of manufacturers are planning to adopt VR within the next three years.

Even in business, the picture is more positive than it might seem. Already, companies like BAE Systems are using VR to let designers and engineers “walk through” the design of a warship before building, UCLA surgeons are using VR to perform dry-runs of highly sensitive surgeries, and real estate firms are using VR to hold virtual open houses.

A Promising Future

And, despite what some might predict, the possibility for growth – in both the technology and the applications – is staggering.

The rise of the VR headset has brought about something exciting in the tech world: for the first time in some time, we have a genuine hardware “tech spec” arms race on our hands. This happened during the advent of video gaming and mobile phones, where we saw companies clamoring to outdo each other in terms of hardware, technical specifications, and computational horsepower. As the technologies started to fully reach their potential, though, the hardware race cooled off.

Not so in VR. The headsets currently on the market are really just prototypes of what they could be. As the motion tracking, graphics processing, and sensory feedback mechanisms of the devices grow, and as they get smaller and more convenient, we’ll start seeing new possibilities in VR. Imagine if those UCLA surgeons, when performing that surgical dry run, could actually feel the tension as the scalpel broke through muscle, or a gamer can feel the impact of a nearby explosion. In both business and consumer market, growth potential in the technology alone puts heavy weight behind the optimistic predictions for the future of VR.

As for applications of VR, we’ve just begun to scratch the surface. What if car designers could drive their creations before ever launching production – and when they drove this virtual car, they could literally feel the response of the steering wheel, the pull of the engine, and the speed of the acceleration? What if, instead of just arranging letters on a screen, coding took place in three dimensions? What if, when moving into a new home, prospective buyers could walk around the space without furniture and arrange new sets as they wish, in real time?

A key milestone in this hardware environment will be the successful implementation of so-called “stand-alone” headsets. These are VR devices that are still powerful, lifelike, and convincing but require no external computational source or graphics processor. Instead of being tied to a bigger computer with a wire, standalone headsets have all the necessary sensors, GPUs, and computational horsepower onboard.

The problem isn’t whether or not VR has the potential to change industries – it’s when the hardware and software will catch up to that potential.

The App to Put VR On Track

According to some experts, the true watershed moment in VR will come when someone develops a “killer consumer app” that creates an experience fascinating enough to pull consumers into the VR space en masse. This reality may be several years to a decade away, but make no mistake: it is coming.

Someone, somewhere, is going to create a VR experience that presents a user interface so engaging, an experience so intuitive, a way of interacting with technology so unique and compelling that it’ll blow the cap off the VR market. It’ll likely come in social networking, but in any case, it will revolutionize just about every consumer application of technology.

Comparing the VR Industry to Mobile Apps

Let’s think about it through analogy. The rise of mobile phones was meteoric, with mobile phone penetration rising from 0% to almost 100% in many countries in the span of just 20 years. The growth of smartphones has been similarly rapid – but what was the pull for consumers to ditch their Nokia flip phone and switch to a smartphone, really?

The answer is simple: mobile apps. Mobile app development created a new market within the device, giving free reign for developers to create new programs on the smartphone that expanded its use well beyond that of just being a phone, camera, or texting device. It was the rapid rise in breadth and diversity of apps, and the incredible functions that some apps provided for consumers, that lead to widespread smartphone adoption. Without that, smartphones wouldn’t have been all that different from regular phones.

Right now, VR has no app store. There’s no unique function that VR headsets provide that consumers can’t get elsewhere, even though elsewhere may mean a less engaging experience. This is why we’re seeing slow adoption of VR. Once companies can solve this problem – either by literally creating some kind of an “app store” for VR devices or by providing an experience through VR that’s so unique and unparalleled that consumers can’t resist – we’ll start to see things go mainstream.

VR’s time in the sun will come when it figures out how to offer the same pull that mobile apps do. Until then, growth will be modest and it’ll continue to be a much-hyped and little-used technology. But once this happens – and make no mistake, it will happen – there’s no turning back, and the changes we’ll see in our lives will be far-reaching and significant.