Virtual Reality: The Next Major Platform

In 2012, a small company named Oculus VR created a campaign on the popular crowdfunding website Kickstarter [1]. The campaign, for a new VR headset designed specifically for video games which the founder designed in his parent’s garage 3 years earlier, raised almost 10 times its $250,000 goal. In 2014, Oculus was acquired by Facebook for approximately $2bn in cash and stock, and a new VR gold rush had officially begun [2]. Since then, Samsung, Sony, HTC and Oculus have all released or announced new VR headset offerings, with Samsung’s Gear VR arriving first in late 2015.

In early 2016, Goldman Sachs Research predicted the Virtual and Augmented Reality market would reach $80bn in revenues by 2025 – larger than the current combined market for desktop PCs and video game consoles [3]. Based on market potential alone, $3.5bn in venture funding was invested in 225 virtual and augmented reality startups over the prior two years [ibid.]. Further proof of market demand happened when the Gear VR was released commercially and sold out on amazon.com and bestbuy.com within 48 hours [ibid.]. Today, the Gear VR counts more than one million active users [4]. Amidst all of the market optimism, however, the real long-term potential of the VR market has not yet been proven. The widespread sales (or presales) of VR headsets still only account for a small fraction of potential users. If VR is to become the next major computing platform, it will have to be continuously refined, and important technical and content-driven problems will have to be addressed.

1. Oculus VR. Oculus Rift: Step Into the Game. Kickstarter. [Online] August 1, 2012. [Cited: April 15, 2016.]
https://www.kickstarter.com/projects/1523379957/oculus-rift-step-into-the-game/description.

2. Facebook. Facebook Newsroom. fb.com. [Online] March 25, 2014. [Cited: April 15, 2016.]
http://newsroom.fb.com/news/2014/03/facebook-to-acquire-oculus/.

3. Goldman Sachs. Profiles in Innovation: Virtual & Augmented Reality. s.l. : Goldman Sachs Global Investment Research, 2016.

4. Lee, Nicole. Oculus highlights over 1 million Gear VR users with new content. Engadget. [Online] Aol Tech, May 11, 2016. [Cited: May 12, 2016.]
http://www.engadget.com/2016/05/11/million-gear-vr-users/.