Updated: May 12, 2017
This narrative was the subject of the Weekly Narrative Video for the week of May 8-12, 2017. You can see the video on YouTube here, and it’s also embedded at the bottom of this essay.
Virtual reality has been one of the hottest technologies of the last couple of years. Though it has in fact been around for decades, it finally seems to have hit the point where mainstream VR experiences start to be compelling and affordable. The combination of PC-, console-, and mobile-based VR provides a range of experiences at different price and performance points for consumers, and there has been strong interest from consumers – Samsung’s Gear VR has sold over 5 million units, and the more expensive PC and console variants have sold well within the context of a much smaller addressable market.
Facebook acquired Oculus on the basis that VR would be the next big interface, having missed out on a strong role in the last major interface: smartphones. Google, too, has made VR one of the categories in which it is now selling first-party hardware, but has also provided a platform for its OEMs to build on. Gaming companies are investing heavily in VR as the next iteration of what they already provide across PCs, consoles, and smartphones, and video streaming services like YouTube and Netflix, along with movie and TV studios are producing content and apps for VR environments.
And yet VR isn’t the only attempt to create a new form of reality – augmented reality, mixed reality and other flavors which combine the real world and superimposed virtual worlds are also taking hold. Apple in particular seems to be far more interested in augmented reality than VR, and hot but mysterious startup Magic Leap is also focused on this space. Pokemon Go has arguably given many consumers their first small taste of augmented reality as well as their first exposure to the term, which is still far less well known than VR. And though Microsoft’s HoloLens is today far more suited to commercial and educational than consumer use cases, it already shows considerable promise in AR.
The next few years will see an interesting battle between VR, AR, and other similar technologies, as various major tech companies place their bets on one, the other, or both. VR definitely has the early lead in terms of consumer awareness and adoption, but a big move by Apple or a strong entry to the market by Magic Leap could quickly begin to change that. I know lots of people who far prefer the idea of remaining present in their physical environments rather than completely removing themselves as with VR, and as such I think AR will find a willing audience if it’s done right. But there are big challenges to be overcome even with AR if it means strapping on a headset or wearing cyborg-like glasses. The form factor here is as important as anything else in determining whether AR is met with acceptance or revulsion.
In all of this, it’s also worth noting that no-one is irretrievably too late if they haven’t launched products yet – though we’ve seen some decent early adoption, the vast majority of consumers have never tried AR or VR in any meaningful sense. Once people do experience the current generation of VR, it’s immediately compelling, though it’s mostly hardcore gamers and early adopters who will actually make purchases for now. The big question for VR is whether it can cross the chasm from gamers to mainstream consumers as a whole, which means far better entertainment, education, communication, and social apps. Technological challenges still need to be overcome too – shrinking hardware, improving frame rates, lag, resolution, and many other factors will be critical for creating truly immersive results. So there’s still plenty of time for others to enter the market.