, 4 min read
Virtual reality… millions but not tens of millions… yet
In February 2016, I placed a bet against Greg Linden in these terms:
within the next three years, starting in March of this year, we would sell at least 10 million VR units a year (12 continuous months) worldwide.
According to some sources, around 5 million units have been sold each year in 2019 and 2020. Strictly nobody is claiming that near 10 million units were sold in a single year. Thus I conceded the bet against Greg and paid $100 to the Wikipedia foundation. Greg has a blog post on this bet.
I believe that both Greg and myself agree that though we have not reached the 10-million-unit threshold yet, we will in a few short years. You should expect a non-linear growth: as more headsets are sold, more applications are built, and thus more headsets are sold…
It is important to put yourself in the context where this bet was made. At the time, three VR headsets were about to be released (Facebook’s Oculus Rift, HTV Vive and the PlayStation VR). As far I know, neither Greg nor myself had any experience whatsoever with these headsets. The Oculus Rift was to ship with a game controller so we had reasons to be skeptical about the hardware quality.
I expected that selling 10 million units a year had long odds. I expected, at best, a close call. Yet I still expected that we would sell millions of units even if I lost, which I believe is what happened. I expected that at least one of the current players (Oculus, Sony and HTC) would fold while at least one new player would enter the market. It seems that HTC bet the farm initially on this market but reduced its presence over time while the Valve Index was a nice surprise.
I acquired several headsets. It turns out that the hardware exceeded my expectations. People who complain about the bulky headsets have often not followed through the various iterations. Hardware can always be lighter and finer, but the progress has exceeded by expectations.
I also built a few software prototypes of my own, and it was remarkably easy. Both of the software and the hardware aspect worked out much better than I expected, but the killer applications have not emerged yet.
My own laboratory acquired headsets and built prototypes. It took me months to reach rather elementary realizations. Explaining VR is harder than it sounds. No, it is not like having moving from a 2D surface to a 3D surface. It is an embodied experience. And that is where I conjecture the real difficulty lies. We are all familiar with video games and movies, and the web. But we have a much harder time thinking about VR and what it can and cannot do.
Let me revisit critically my statements from 2016:
- Virtual reality is a major next step so that backers will be generous and patient.
It is unclear to me how much truth there was in this statement. Certainly Facebook, Valve and HTC have invested a lot but I kept hearing about start-up folding up early. The fact that hardly anyone made a lot of money did not help. Meanwhile, a lot of the people working in VR can quickly switch to more profitable non-VR projects, so the talented individuals do not stick around. - I’d be surprised if the existing Oculus Rift sold more than a few hundred thousand units. It is just too expensive. It just not going to be on sale at Walmart.
The Oculus Rift is on sale at Walmart for $300. But I am correct regarding the unit sales: the Oculus Rift did not sell in the millions of units. - But within two years, we can almost guarantee that the hardware will either be twice as good or cost half as much. With any luck, in two years, you will be able to buy a computer with a good VR headset for a total of less than $1000 at Walmart.
I did not foresee that standalone headsets like the Oculus Quest would essentially match the original PC headsets at a fraction of the cost. The Oculus Quest is under 500$. Cheaper than a game console. It is light (500g), it has high resolution ( 1832×1920 per eye). It has a low-latency 72 Hz display. Six degrees of freedom. Sadly, you must tie it to your Facebook account which is a turn off for many people. There are rumours of very good Chinese headsets but they have not been commercialized yet where I live. - A company like Sony has more than enough time in three years to bring the prices down and get game designers interested. Will the technology be good enough to attract gamers? If it is, then it might just be possible to sell 10 million units in a year.
Sony released the PlayStation 5 without stressing VR. Half-Life: Alyx was one of the best-selling game of 2019 but it did not sell in the millions. There are good VR video games but very few high-budget ventures.
Conclusion. VR did not see the same kind of explosive growth that other technologies have seen. But the infrastructure has been built and the growth will happen. Prices have fallen and quality has jumped up. Sooner than you think, VR will enter your life if it hasn’t yet.