VR losing its luster?

According to ABI Research, the virtual reality (VR) market is at a crossroad. While 2018 tethered and standalone VR shipments are expected ...

OTT video to hit $51.4 billion in 2022
OTT video to hit $51.4 billion in 2022

According to ABI Research, the virtual reality (VR) market is at a crossroad. While 2018 tethered and standalone VR shipments are expected to exceed those of previous years, mobile VR has taken a distant back seat to the latter, with few updates coming from major mobile players Samsung or Google. Despite the ongoing traction in the enterprise market (including location-based VR), the consumer space has entered a malaise, ABI says, and some within the content and video workflow space have tempered expectations. The research house has lowered its installed base forecast to clear just over 140 million by 2023, contingent on mobile VR turning things around and again becoming a viable segment of the market.

"We can view the VR market as bifurcated into two distinct user experiences, one where mobile and lower-priced standalone devices reside and stationary 3 Degree of Freedom (DoF) experiences predominate, and the other where tethered and premium standalone serve 6DoF and/or room-scale applications," said Michael Inouye, principal analyst at ABI. "While there are currently some standalone solutions that bridge the two, these are transitional devices. Developers and end users will select the type of movement based on intended application and potential market opportunity. If mobile VR continues to wither, the market will shift to dedicated devices and 6DoF, keeping VR a niche technology for a longer period."

Mobile gaming is a massive market due to its significant user base that VR has not yet tapped into in a significant way. Without a large mobile VR user base, consumer-centric developers will focus on the premium side of the spectrum, where users are less price sensitive and generate more revenue per user. Successful console platforms hit tens of millions of units, but with Microsoft Xbox still on the VR sideline, VR's potential in this facet of the market remains limited. The slower development of the consumer market is also retarding the pace of innovation and technological advancement as a whole.

"Some viewed HTC's Vive Pro as too incremental of a step forward and view similar rumors regarding Oculus' next tethered solution with equal concern. While these limited steps forward in technology are pushing out original technology timelines, these decisions are helping to grow existing installed bases, rather than creating fragmentation," said Inouye. "Additionally, as computing power grows each year, so does the potential reach of these HMDs. VR remains a long-term prospect, albeit becoming increasingly longer, but in the interim, related areas such as augmented reality (AR) could spill over and add additional fuel to the VR space."

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