Boom Or Bust? See What's Ahead For VR

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Boom Or Bust? See What's Ahead For VR
July 3, 2017

Given the gap between technology and society, virtual reality's commercial prospects are unclear.

 

Once the novelty wears off, a promising new technology can quickly become yesterday's gimmick. Remember the Palm Pilot day planner and Microsoft's Wii with its motion-controlled video games?

 

Or how about 3D-enabled TV? In 2010, DreamWorks chief executive Jeffrey Katzenberg declared that would be "quite simply the entertainment revolution of our time … as important as the introduction of sound or color." Now Sony, Samsung and LG have stopped making them.

 

Sometimes innovations simply don't offer anything that average people want, let alone need, in their everyday lives.

 

"All the enthusiasm from VR manufacturers and developers just hasn't been met with the same volume from the consumer market," cautioned Shauna Heller, a former developer relations specialist at Oculus.

 

Oculus, which produces high-end VR headsets and was acquired by Facebook in 2014, has created headaches for consumers and investors alike. Facebook CEO Mark Zuckerberg has said that he wants "a billion people on Facebook in virtual reality as soon as possible." But in a February conference call with shareholders, he acknowledged that it's been a tougher, slower sell than anticipated.

 

"We're a little behind from where we want to be" on the $2 billion purchase, he said, warning that VR sales "won't be profitable for quite a while."

 

In January, with sales beneath expectations, Oculus sizably trimmed its presence in the consumer marketplace. Best Buy does not release sales information on individual products, but in January it closed Oculus Rift demo stations at about 200 of the 500 stores that had offered them. Best Buy publicist Danielle Schumann termed the downsizing "a mutual agreement" between the vendor and manufacturer.

 

A recent study by market analysis firm Forrester Research was titled "Virtual Reality Isn't Ready for Marketing Yet." It predicted that "critical-mass consumer adoption of high-end VR headsets is five years away." Or, perhaps, 10.

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