Virtual Reality: At the Peak of Inflated Expectations

Where did it all go wrong?

In this article, I’m going to talk about how I perceive the mainstream consumer audience to have rejected virtual reality, and suggest that its child, augmented reality, may be the Slope of Enlightenment (of the Gartner Hype Cycle) that convinces us to buy in. While these are my views alone, towards the end of the piece, I’ve unearthed some data from software developers around the world who are working with AR and VR. Even if you don’t care about my views, you may find what they have to say interesting. And, if you’d like to express your own thoughts, I’ve included a link to a survey that’s open right now, the results of which will help key players in the industry to draw their own conclusions in 2019.

From Wikipedia: The hype cycle is a branded graphical presentation developed and used by the American research, advisory and information technology firm Gartner to represent the maturity, adoption, and social application of specific technologies. The hype cycle provides a graphical and conceptual presentation of the maturity of emerging technologies through five phases. Image by Jeremykemp at English Wikipedia [GFDL (http://www.gnu.org/copyleft/fdl.html) or CC BY-SA 3.0 (https://creativecommons.org/licenses/by-sa/3.0)]

Tomorrow’s world, today

I worked in the smartphone industry before it came of age. Our mission was “a smartphone in every pocket” at a time when simple feature phones like the Motorola RAZR were the must-have communications device. Within a few years of our early projects, the competitor, Apple, launched the iPhone. The rest is history. The App Store opened its doors, the stars aligned, the technology dream was realised and smartphones went on to rule the world.

I grew up in a time of change. We had a BBC microcomputer before I was ten years old. As a teenager, I sashayed along to the sounds of the eighties on a tape Walkman, and later mobile CD players and minidiscs. Then Napster, now Spotify. Change. The cadence of technological evolution was a rapid heartbeat, sounded out by the Internet, mobile phones and a maturing software development industry, which I joined enthusiastically.

Maybe I just got used to an unrealistic pace of change? But whatever happened to virtual reality (VR)? Its heartbeat seems to have flatlined. Nothing much has changed in the years that have passed since the “year of VR” (pick your year, we’ve had a few of them), which turned out to be nothing much of the sort. When I look at my mobile phone of a few years ago, or my website developed in 2004, I think how clunky and quaint they look compared to the sleek form factor and execution possible today. But when I look at the VR headsets of yesteryear and today and compare what they deliver? Not so much.

Take a look at this slideshow of legacy VR hardware. Sure, we’ve come some way since the Sensorama, but the Sega VR of 1993 wasn’t significantly more dorky than today’s HTC Vive Cosmos, was it?

Dweebs in Sega VR and HTC Vive Cosmos devices, unbelievably separated by 25 years

Image from TechRepublic

Image from YugaTech

Does anybody really want to strap on a heavy, nerdy headset that makes you suffer motion sickness after a few minutes use, tethers you to a PC, dulls your senses to the real world outside the headset and causes you to trip over your furniture?

Sure, expensive and shiny, next generation VR devices, are coming. But much of the hardware available is unchanged from when it came to the stores two or more years ago, which means hard-core early adopter audiences aren’t shelling out again. While availability of more cost-accessible hardware for casual users has increased, e.g. the Oculus Go, the handsets are still expensive enough to give mainstream consumers pause, and typically compromise on aspects of quality that mean the VR experience is somewhat flawed.

Convince people that you’ll change their lives

In the consumer world, expectations for VR were raised early and sadly led to disappointment as it became clear that the ambitions went far beyond what was possible given the technology available. Overpromised, VR lost the attention of mainstream audiences, as it simply could not deliver. In part, this was down to problems with the hardware, such as cumbersome headsets, inadequate processors, poor displays and weak audio. Then there’s the secondary reason: there is no “must-have” killer app that convinces sufficient people that you’ll change their lives.

The two issues go hand in hand (the ‘chicken and egg’ situation) since if technology is inadequate, the content creators see no justification for investing heavily in VR. In turn, this means insufficient buyers and revenue to justify the investment in improving the technology. (It’s worth pointing out that secondary uses for VR, such as in industry, education, healthcare, have a very different uptake/content model, and as such, I’m considering just the mainstream here).

And, as such, entertainment content is the key to unlocking adoption by persuading consumers that VR devices are a must-have item. Like 3D TV, VR has thus far failed to deliver a sufficiently convincing experience that sends people rushing to shops to buy the hardware, despite its costs and the limitations involved.

What’s more, VR content isn’t coming along as fast it used to. Hollywood used it for marketing, e.g. to promote films such as 2016’s Fantastic Beasts and Where to Find Them and TV shows including Game of Thrones. But this has dropped back as consumer uptake and gratification was found to be negligible.

Venture funding for consumer VR software companies may drop by more than half this year, to $265 million from $576 million a year ago, SuperData says. And this isn’t surprising. According to the SiliconANGLE. VR headset sales have dropped nearly 34% since Q2 2017. Even committed hardware manufacturers are showing signs of taking their foot off the gas. Samsung, which was one of the first to market with its Gear VR mobile headset, didn’t say anything about VR in its major announcements at CES this year.

Is AR the way out of the trough of despair?

Experts predict that new kids on the block, Augmented Reality (AR) on smartphones and Mixed Reality (MR) headsets, such as Microsoft’s HoloLens. will pick up the audience that VR failed to serve. In terms of the hype cycle, AR and MR — the children of VR — look to serve as the Slope of Enlightenment.

AR can be delivered by the hardware already in your pocket. It doesn’t need the level of resolution or processor power demanded by VR. AR is also far less cumbersome than VR and can be used on the go since it doesn’t require total immersion in the experience. The software brings in a virtual element without losing the real world.

Certainly, analysts report adoption of augmented reality and mixed reality to be on the up, with earnings expected to come from mobile AR apps, particularly games. Google and Apple have strongly embraced this market with ARCore and ARKit, enabling developers to access AR services on more than 500 million devices in the wild today. Both Apple and Google envisage third-party apps and services that use AR as valuable additions to their app stores. Successful apps add billions to the top line (Apple was expected to make $3 billion revenue over 2 years from in-app purchases within the best known AR title to date, Pokémon Go) and high-profile AR apps also strengthen the ecosystems of both companies, boosting other revenue streams.

The smart money is now shifting to companies working on AR and MR. Apple have a rumoured research project to build a headset for delivery next year. Investment in companies working on MR is expected to jump by nearly 50 percent this year, according to SuperData, with sales of MR headsets expected to ramp up significantly and surpass earnings of VR headsets within the next two years.

The above is purely my opinion, based on observations of the tech industry over a number of years and a healthy degree of skepticism when it comes to inflated expectations. It’s uninformed by experience at the coalface of development however. So, what do software developers working with AR and VR, have to say?

Software developers working in VR and AR told us…

Here at SlashData we run regular surveys of software developers around the world to uncover valuable insights from those working in mobile, desktop, IoT, cloud, web, game, AR/VR, data science and machine learning.

In our Developer Economics 14th edition report, which is based on a large-scale online developer survey that ran over a period of eight weeks between November and December 2017, we reached over 21,700 respondents in 169 countries. We studied the data returned from developers working in AR/VR and found the following:

• 25% of professional game developers say they are targeting AR and/or VR. This figure falls slightly to 19% across the entire corpus of developers surveyed.
• Dedicated VR hardware, such as Oculus Rift, is attractive to games developers (61% report using it), but across all developers working on VR projects, we see a much lower uptake (33%), reflecting its early adopter status in fields other than games.
• Across all developers working on VR projects, 32% are targeting smartphone hardware using Google’s Cardboard, and 19% are using Daydream View, built into Android Nougat and beyond, reflecting that developers, and consumers, are still experimenting with the technology on their existing hardware.
• A similar picture emerges for AR, with Android and iOS taking the lead in most popular AR platforms across all developers targeting AR.
• Of the dedicated AR hardware available, Microsoft HoloLens leads the pack, with Google Glass at Work and MagicLeap trailing behind when the survey ran in late 2017.

We are currently running another survey and we would value your input. If you’re a software developer working in the field of AR or VR, or thinking of doing so, please consider answering the questions. If you’re not a developer but are working in the AR/VR field, pass the link on to your developer friends and colleagues.

Every survey completed has a chance to win Oculus Rift +Touch Virtual Reality System to test your creations (or simply play around), Samsung S9 PLus, $200 towards the software subscription of your choice, or other prizes from the prize pool worth $12,000. Plus, if you refer other developers to take the survey, you may win up to $1,000 in cash. Just don’t forget to sign up before you take the survey, so that we know you want to be included in the prize draw.

What do you say, are you in?