Is 2020 the point at which VR finally delivers on years of promise?
Image credit: Dreamstime
Signs that virtual reality is finally poised to break through serve to illustrate how the days when a single technology could be the ‘next big thing’ are over.
What are the big tech trends you remember from the past five years? I was at a technology conference in 2016 where everyone was raving about the impending impact of the Internet of Things. Subsequently, we’ve heard the buzz around drones delivering our takeaway dinners and Amazon purchases; Cloud being the ‘new mobile’, autonomous vehicles changing how we travel and, most recently, artificial intelligence as the new space race. None of these technologies have quite fulfilled their hype yet and the same can be said for the big tech hype of 2015: virtual reality.
When Facebook acquired Oculus in 2015, the VR hype curve was almost off the charts. Since then, VR has fallen into what Gartner has dubbed the dreaded ‘Trough of Disillusionment’ [editor's note: this is stage three on Gartner's 'Hype cycle' and is characterised by waning interest as the early excitement fades and experiments and implementations fail to deliver. Producers of the technology shake out or fail. Investment continues only if the surviving providers improve their products to the satisfaction of early adopters], but is now re-emerging at speed and ascending stage four of the hype cycle, the 'Slope of Enlightenment'. Many people are predicting that 2020 will be the year of virtual reality and the evidence is becoming hard to ignore.
The VR market was valued at $11.5bn in 2019. It’s expected to reach approximately $88bn by 2025, which is welcome news for those in the sector. Last year saw annual consumer VR software sales break the significant $1bn mark for the first time. The fact that the Oculus Quest - a ‘6DOF’ wireless headset that provides virtual reality with six degrees of freedom - is in such demand that there’s a global shortage tells its own story.
Pico, the Chinese headset maker, is also producing an excellent standalone VR headset that is cheaper than the Oculus Quest. Better content with cheaper and easier to use hardware seems to be the drivers in the consumer market, but there’s another factor driving the increase in uptake - enterprise VR.
The ‘race to be second’ is the phenomenon whereby more conservative companies wait for others to prove the business case before committing to a technology. For VR, the race is almost over as case studies start to emerge from leading companies such as Pfizer, IAG and Walmart that claim to have achieved stellar results.
VR is already a go-to technology for hazardous work environments, with many energy companies such as Shell, Chevron and ExxonMobil seeing it as an obvious way to train their employees for risky, remote and rare operational environments.
The same can be said for the leading militaries in the world, who see VR simulation as an obvious way to improve training while reducing risk and cost. VR’s use for training, in particular, is predicted to achieve a compound annual growth rate of 61.8 per cent over the next three years and is forecast to become the largest use case in terms of business-to-business spending on VR by 2023.
There are still some barriers to immersion and widespread adoption, though, such as awkward hand controllers; the lack of ‘feel’, and grumblings about Oculus’s B2B business model, supply chain and customer support. Some of these do look likely to change in 2020 and also provide opportunities for more enterprise-focused VR companies.
Oculus has released a beta version of its hand tracking that removes the need for controllers to some extent. Tesla Suit, BeBop and a host of others have announced the release of haptic gloves that provide a simulated feel and touch in VR. Perhaps equally as impactful as the new products and features emerging in VR are the new business models. As the market grows, so do the opportunities for companies whose business models best support their customer’s needs.
The question remains: is VR the next big tech trend for 2020? It isn’t as simple as a yes or no answer. Perhaps the third decade of the 21st century won’t be dominated by individual technologies, but rather by the confluence of the technologies we have seen develop over the last five years.
IoT sensors are now in many new ‘smart’ products, while high-speed broadband is increasingly available and will soon be available via mobile 5G. Companies like Google and Amazon are making AI and cloud computing more broadly available to businesses and improved mobile processors are increasing the capability of hardware while reducing the cost. The most successful businesses will be the ones that leverage these technologies to solve problems for their customers and do that in a sustainable way.
As a VR company co-founder, I strive to provide our customers with either leading-edge technologies or the innovative combinations of existing technologies that they need to improve their businesses. As any entrepreneur worth their salt will tell you, it's not about the technology, it's about solving your customer’s problem and unlocking that shared value.
Pat O’Connor is co-founder and managing director of virtual reality content-creation company VRAI.
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