June 22, 2016

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Virtual Reality: Mix of Hype and Expectations

Co-author: Atin Agarwal

Over the last couple of decades, we have seen a lot of services and goods becoming digitalized. Primary targets have been movies, books, music, and games. Most of the processes in hotel industry, gaming and broadcasting has already been digitalized. Now, it’s the turn of experiences – experience of parachute jumping, mortal combat, shuttle landing and a walk on planet Mars, all by sitting in the comfort of Living Room.

Beginning of Experience Era: Virtual reality (VR) is a simulated environment in which the user suspends belief and accepts it as a real state. Head mounted VR devices (HMD) let the users interact with the virtual objects. For Example User’s gaze can be used as a curser and a push button on the HMD as a trigger point. Few devices also provide seamless integration with the joystick, enabling inputs via D-Pad and call to action buttons. Further complexity includes the use of gesture controllers and trackers to trace the user’s position in real surroundings and translate the same to artificial environment. Sensing the movement in 360 environment has been possible via gyroscope, an accelerometer and a magnetometer embedded in HMD, which tracks the head movement in all the 3 axis.

Virtual Reality Market Share: By end of 2015, we have seen virtual reality picking a lot of momentum. In fact it has been used recently during the World Drone Prix in Dubai in March 2016. Pilots seating in racing style seats, watched the camera feed from their drones on their goggles.

But it’s still a long way for VR to be adopted in a massive way. In the current situation mobile devices seems crucial to the market’s initial growth. Customers will explore VR first through their smartphones and later commit themselves to the more expensive platforms. After this first wave, it is the more high-end devices on PC and console that will provide much better immersive experience and hence, drive exponential growth.

Expectations or Hype: Most of New Media companies are still experimenting with Virtual Reality. YouTube and Facebook introduced 360-degree videos streaming which can be consumed through Google Cardboard headset, providing a sense of real depth rather than just the ability to pan around. Further, we have a new wave of next generation PreMedia companies that only specializes in creating 360 content. It has become a new untapped arena for the marketers.

When oculus first appeared as a funding campaign, it was all about games, with a promise of more than 100 titles by the end of 2016. Eventually, VR also found its relevance in most of the industries – sports, education, and broadcasting. It is projected that Video entertainment will continue to have over 20% of the revenue generated by VR industry whereas gaming will have the lion’s share of over 35%. It was clear from CES 2016 demonstrations that VR has started moving from the experimentation to actualization. Users can now play Minecraft game on their Samsung Gear. Oculus has now started shipping out Home editions. According to NextVR, soon users will be able to see NBA Live on head mounted devices.

Sports Industry: Numerous athletes — from the amateur to professional level — can now use virtual reality to supplement live practice. It can be a quarterback swiveling his head, scanning for holes between defenders or a hitter timing its break over the plate for pitcher's curveball. All can be done without another person or a field. It can be used for emotional trigger by experiences what it’s like playing in front of more than 100,000 fans at the Big House.

Gaming Industry: Besides, traditional games that can be played with VR flavor, one can enjoy a walk through a casino floor, interact with virtual environment, even sit on a slot machine and can play it.

Broadcasting: Imagine while sitting in his home comfort, one can enjoy a soccer game in the Kingsland seat of the Old Trafford stadium where Manchester United is playing against Chelsea. Content providers like BBC, Discovery are working tirelessly to provide media content for VR devices also.

Healthcare: VR potential in this vertical is open ended. From exposure therapy to PTSD treatment, VR devices can be used for surgical training as well. The VR experiences can provide a controlled environment in which patients can muddle through coping strategies by facing their fears, hence breaking patterns of avoidance. 

In all this experimentation and hype, besides getting VR hardware into people’s hands, biggest challenge that can define the success of VR technology concerns what it does to us as humans – a question that’s about more than motion sickness. It is most important as VR is seen as the extension to the human body. The current experience can cause eyestrain, headaches and nausea if used for prolonged period. Remember the social isolation caused by smart phones, VR can take it to the next level. Users will lose out on many of social interactions. VR can be seen as game changer but its real success will be expressed by its social benefits and its underlying costs.