A year-end review of VR: The good, the bad and everything in between

Jan 8, 2017 - min read min read

With prices coming down and specs becoming less prohibitive, forward-looking companies will continue to discover new ways to use VR to inform, educate and entertain their customers and their employees. The era of VR for its own sake has clearly passed. It’s in the process of transforming itself from a gimmick to a tool with practical, profitable applications.

The start of the new year is a good time to take a look back and see what kind of a year 2017 was for the VR industry, and also to venture a few predictions about what’s to come in 2018. There has definitely been progress made and lessons learned on many fronts over the past year. This all adds up to a very exciting developments.

Following a predictable path

Before we all start making Big Statements on the state of VR, let’s remember that its progress is following the same trajectory that all new technologies do, called the Gartner Hype Cycle. The first stage is the initial excitement and flurry of innovation that comes with the early proof of concepts. This leads to all kinds of unrealistic expectations, which inevitably are disappointed. While we might see scattered (and limited) success stories, there’s no general buy-in. The technology’s just not “there” yet.

It all seems to skid down from the peak of optimism to the valley of disillusionment, which is the second stage. At this point lots of companies — startups and established ones — scale back their ambitions, or give up the project completely. But this is where it’s crucial that companies keep working on improving the tech and keep engaging the adventurous early adopters, and persuading the skeptics.

Don’t worry, it gets better

Eventually, the bugs are worked out and the benefits become clear. Then comes the period of real productivity and continued development, and we start to see applications in all kinds of different industries. Ta-da! In 2017 we already passed Stage 3!

Right now, VR is in the slope of enlightenment. That’s okay, it’s normal and it will probably take another 2–5 year till mainstream adoption. Some companies will decide VR is not for them. Nokia for example, who already shut down development of their all-in-one camera system with the OZO + software, which seamlessly integrates raw footage with post-production workflow. Nokia cited the “slow-growing virtual reality market”. In our opinion, the reality is, its failure probably had as much to do with the fact that the product was just not that good and their pricing strategy was a big mistake.

What’s in store…

We’re happy to say that things are looking up for the near future. Advertisers are starting to embrace the possibilities of VR, and understanding that with immersive storytelling — and the right creative team — they can turn their brands into lifestyles.

Developers and users are finally discovering the ways to take advantage of the technology in storytelling and practical applications such as training, real estate, sales and recruitment. But from what we’ve seen so far, the possibilities are virtually limitless.

A key component of this will be content. The need for high quality content that is not only visually pleasing and narratively enticing, but that also keeps vection to a minimum will be more important than ever. We’re already seeing studios like Chris Milk’s Within raise millions of dollars based on the creation of great VR content.

Products in the pipeline

We can look forward to the introduction of some new hardware in 2018, such as models from Oculus Rift and Vive. Today’s Rift and Vive headsets are built on what’s known as outside-in tracking technology. Sensors on the outside of the headset “watch” the headset and allow the system to orient and position a person’s head and hands in the virtual universe. The result is an accurate VR experience in a defined space seen by the sensors.

Inside-out VR technology will likely be the future and that’s what Oculus’ Santa Cruz, as the product is codenamed, is built on. The headset itself has the sensors and looks at the environment around it to place the user in a virtual environment, with the result that the size of the potential space is theoretically infinite.

In October of last year, Oculus introduced the new Oculus Go headset during their Oculus Connect event. This headset is a low-cost, all-in-one standalone headset which doesn’t rely on a smartphone or a computer, and with a price tag of $200 rather than, say, $1,000, Oculus Go could be the product that truly takes VR mainstream. Zuckerberg stated that they want one billion people in VR.

Facebook, with its acquisition of Oculus Rift in 2014, has hopes to make VR a social experience with users inhabiting the same virtual world. That will take a hugely robust platform that can handle thousands of users and very high-speed bandwidth. So the consumer market still has a way to go, but the direction is crystal clear.

Microsoft’s new Hololens mixed-reality device, bills itself as the world’s first fully untethered self-contained holographic computer. As a mixed-reality, or Augmented Reality (AR) device, it doesn’t block out the real world like VR does; this means users can interact with actual objects and other people while wearing it. This has tons of potential for collaborative activities and projects.

In a bid to keep up with the competition and to provide something new to the market, Microsoft is pushing its Mixed Reality ideas to its third-party partners around the world. The planned devices from Acer, Dell, Lenovo and HP will cost less to own than the Oculus Rift and the HTC Vive. Furthermore, there’s no need for an ultra-powerful computer to get great results.

Very interesting to us here at yondr, as a solution-driven VR agency, is that we saw that Oculus and HTC have been investing in ‘heavy’ pc’s, because they weren’t compatible with a regular laptop. Samsung VR gear required a Samsung Smartphone, so people with an Iphone suddenly had two mobile phones. But a lot of big companies and corporates work with windows laptop and these glasses work on a ‘plug and play’ basis with usb, so it’s a whole lot easier to facilitate HR and sales people with a Microsoft headset — available for only 299 euros.

Location-based Virtual Reality

Moving out of homes and into a larger arena, VR arcade centers are starting to pop up all over the world. Imagine going to your favorite internet café, which now will be transformed as VR centers. We’re going to be seeing more and more of those in the coming year. And this will be critical for mainstream adoption of VR. Dreamscape (Investors: Disney, Warner Bros., 21st Century Fox, …) and IMAX are only two examples of companies that are looking to take VR out of the living room.

Apple is going all-in on AR, for now. We believe their rationale is — no surprise — they want to sell more iPhones. With an iPhone, users can get started with AR right away, without dealing with VR’s hardware/content issues. The quality of the headset simply isn’t good enough these days to reach the Apple standards and moreover, they were never first movers in terms of new computing platforms.

Hedging their bets, Apple very recently acquire Vrvana, out of Montreal. Vrvana is unique in how it utilizes a camera instead of transparent, projection-based displays used by companies such as Microsoft. Vrvana says that the headset is an “extended reality” device, utilizing both AR and VR technology.

The future of VR is already here

With prices coming down and specs becoming less prohibitive, forward-looking companies will continue to discover new ways to use VR to inform, educate and entertain their customers and their employees. The era of VR for its own sake has clearly passed. It’s in the process of transforming itself from a gimmick to a tool with practical, profitable applications.