While consumer adoption of VR has been slow, companies are taking advantage of increased interest while enterprise use continues to grow.
In 2014, Oculus founder Palmer Luckey predicted that virtual reality was, “going to change the world.” Fast forward six years, and virtual reality seems to have failed to take the consumer world by storm.
Up until now, according to tech consulting firm Omdia, global consumers own just 26 million VR headsets – and many of these are gathering dust. Yet that is not the full story, especially amidst the COVID-19 pandemic.
Extended lockdown periods seem to have some consumers taking a second look at VR. Not only has the gaming VR market seen an uptick, but companies are finding new ways of making it more useful and accessible to non-traditional users of the technology.
This, coupled with that fact that despite consumers not having yet caught the VR bug en masse, many businesses have, and there are signs of hope for the future growth of VR.
The consumer sector – hot or not?
Although most people who try high-end VR headsets end up being blown away by the experience, this enthusiasm has not yet translated into major sales. The industry may not have helped itself by promoting clunky, low-end products that paired with smartphones, like the free Google Cardboard. These were intended to draw interest by demonstrating the potential of VR, but what they mostly did was convince people that the technology was limited and uncomfortable to wear.
By and large, the consumer VR industry suffered from a familiar chicken-and-egg problem. The high-quality headsets were too expensive for most consumers and without a large customer base, content developers were not motivated to produce applications. Yet, without the must-have applications, consumers were unwilling to shell out for the headsets.You will find more infographics at Statista
But it is far too soon to count consumer VR out yet. Many of the investments in consumer VR, especially in the US, are aiming at the games market. In March 2019, Sony announced it had sold 4.2 million PlayStation VR (PSVR) headsets, while in April, Nintendo released a low-tech VR set for use with the Nintendo Switch.
Since its release in 2019, Facebook’s Oculus Quest has seen steady sales. The all-in-one headset offers six degrees of freedom tracking, which means that the headset has the same full tracking capabilities typically reserved for high-end PC-driven VR headsets—without the games console.
Enterprise as the major growth area
Yet, while apps and headsets for the entertainment sector may get the most attention, the real area of growth is in enterprise applications. Surveys show that businesses are adopting VR at twice the rate of consumers.
Everyone from Walmart to Dutch shipyards is using VR to train workers. Engineers use it to create realistic simulations and to collaborate with far-flung colleagues in a holodeck-like environment. Militaries use VR to train soldiers and medics in battlefield engagement, in-flight simulation for pilots and to conduct virtual boot camps. Car showrooms use it to demonstrate the features of high-end vehicles.
The health care sector is another growth area. By creating synthetic environments designed to evoke specific physical and emotional reactions, VR is already being used to treat conditions such as stroke and anxiety. In the future, VR immersion may be viewed alongside drugs and surgeries as a standard medical tool.You will find more infographics at Statista
The future of VR is in Asia
There is also evidence that the VR market in Asia is about to take off in a big way. Policy support from Beijing, along with the rollout of 5G networks, means that the market for VR in China could soon outstrip that in the west.
The Chinese Ministry of Industry and Information Technology expects to see the compound annual growth rate of the VR market reach 91.2 per cent in the next few years. The Chinese government has plans to grow a domestic VR industry, creating key patents and industry standards that would make Chinese VR companies globally competitive by 2025.
But it is not the consumer market that China has its eyes on. Rather, government investments are directed towards applying VR technologies to the manufacturing, education, culture, health care and commerce industries. According to the Chinese government, adopting VR technologies to research and development, testing, maintenance and training in the manufacturing sector will allow enterprises there to vastly improve their design and service capabilities.
The COVID-19 effect
The coronavirus pandemic may also provide a boost for VR. As the world went into lockdown, there was a big uptick in demand for VR applications. Entertainment companies, particularly those that rent out high-end VR gear, have seen a big increase in interest as people search for new ways to connect.
Consumers have adopted all kinds of new behaviours during the shutdown, including Zoom happy hours, virtual games nights, Netflix parties, online learning and working from home – and VR is well placed to serve this new market.
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Amidst the lockdown, there has been a huge growth in the market for social VR environments. For example, party planners have pivoted to organising VR birthday parties by sending everyone a rental headset and designing a customised party zone. People are also using VR to experience virtual play centres, museums, after-work drinks with colleagues and even virtual holidays – all from their living rooms.
While many of these virtual social occasions may not outlast the pandemic, it is likely that one trend that will continue is working from home. The pandemic has seen a big growth in platforms, such as AltspaceVR, that create virtual meeting spaces. The global rollout of 5G is going to increase the feasibility of having people work from home more or less permanently, using VR spaces to communicate, collaborate and even socialise with colleagues.
And not all of these solutions require a headset. Companies such as Spatial are developing cross-platform solutions that allow people to enter a VR space from a computer as well as a headset. Inspired by companies that started holding meetings in Second Life, VirBela is developing a platform that lets conferences take place in custom-designed virtual worlds. And Argodesign is working on an artificial computer window that simulates working next to a real-life colleague.
As the world adapts to a new reality, there is a real opportunity for VR to help deliver that reality. Although it will never replace real-life, the VR industry is positioning itself to deliver the next best thing.
Written By: Lisa Magloff
24th June 2020