When it comes to success in virtual reality (VR), the bar, right now, is set pretty low. Indeed, the main selling point behind one of the first successful VR headsets, the Oculus Rift, was that it didn’t make you throw up, wrote Virginia Heffernan in the New York Times in 2014.
But so impressive was that singular achievement that, the same year, Facebook paid $2 billion for Oculus before it had even shipped a product, adds Glenn Peoples in Billboard.
It’s easy to believe that VR, which uses a headset and software to simulate an immersive, three-dimensional experience, is simply the next craze in entertainment. And it’s true that the first big market for the technology is in entertainment. “Deloitte Global predicts that virtual reality will have its first billion-dollar year in 2016, with about $700 million in hardware sales and the remainder from games and other VR ‘experiences,’” writes Mae Anderson in the Dallas News.
Deloitte estimates that 2.5 million headsets will be sold this year, Anderson adds, and other surveys have indicated that consumers are curious about them. A 2015 survey found that 95 percent of people were generally aware of VR, and 55 percent of those said they were likely to purchase a VR device in 2016. When it comes to knowing name brands, the numbers get fuzzier. One study from Horizon Media found that while only 33 percent of respondents were aware of specific VR devices, 36 percent of that group was interested in owning one
In terms of market predictions, Trendforce forecasts the VR market will rise from $6.7 billion this year to $70 billion in 2020, while SuperData Research predicts a global base of 56 million customers will spend $5.1 billion on VR content and related hardware this year, Peoples writes. In other predictions, CCS Insight forecasts that 24 million devices will be in the hands of consumers by 2018.
Storage and Format Wars
As with any new technology, some issues need to be worked out. “A 20-minute file can run 300 to 400 megabytes, large enough to require ample hard drive space and impractical for streaming,” Peoples writes. “Differing file formats could create a battle like VHS versus Beta in the ’70s.” But despite that, VR was the hit of the South by Southwest conference earlier this month, Anderson writes, noting that companies ranging from the New York Times to Google to Samsung demonstrated applications of the technology.
But the industry is suggesting many business cases for virtual reality as well. “VR already allows prospective home buyers to remotely tour a home,” Peoples writes. “Tourism boards can use VR to show potential visitors the sight and sounds of their local beaches, historic districts or architecture. There are numerous possibilities in health care, from helping surgeons to rehabilitating stroke victims.”
Other use cases include fashion and training, particularly military training, writes Daniel Terdiman in Fast Company. Additional possibilities include prototyping and instruction manuals. It could also make other kinds of training, such as sensitivity training and practicing speeches, much more realistic, writes Joanna Stern in the Wall Street Journal. “What if VR could make us behave better in the real world?” she writes. “What if it could make us more empathetic to strangers? What if it could help us conquer our fears?”
Needless to say, organizations that make and sell ads are also looking at the technology. “For advertisers, the appeal is clear: In a world where consumers are constantly distracted, experienced in becoming blind to ads, and downloading ad blockers, virtual reality offers a fully-viewable experience,” writes Lara O’Reilly in Business Insider.
VR could also transform meetings, writes Tracey Lien in the Los Angeles Times. One such app “uses the head tracking capabilities of virtual reality headsets to determine where a person is looking and how his or her head is moving, and translates that into the avatar’s movements,” she writes. “It also simulates being in an actual physical space with other people by allowing users to hear someone better if that person’s avatar is closer. Getting really close to someone’s avatar lets users whisper.” Not to mention, you can tell whether people are paying attention, she adds.
Moreover, consumer companies such as Coca-Cola and McDonald’s—as well as hardware and software companies such as Intel—are investing in the technology, and you have to believe they wouldn’t do that if they didn’t see a market in it.
Admittedly, we’re going to have to get used to people around us looking ridiculous—and looking ridiculous ourselves, as well as the aforementioned nausea. But in the same way that we’ve gotten used to people on street corners talking to themselves and walking into telephone poles as part of the cost of taking advantage of the benefits of cell phones, we will surely adapt.
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