According to the The 15th edition of Technology, Media & Telecommunications (TMT) by finance company Deloitte Global, virtual reality (VR) will generate $1 billion (R16,6 billion) in 2016. This is split into $700 million (R11 billion) for hardware and the remainder in VR content.
These numbers are composed of a predicted 2.5 million VR headsets and 10 million games sold.
“While in 2016 virtual reality is expected to reach a major milestone―becoming a one billion dollar market—in the long term VR is likely to struggle to reach the scale or ubiquity of the smartphone, PC or the television set,” said Sharoda Rapeti, Deloitte TMT director. “However, as the technology required to provide a total immersive experience improves, wider global adoption may ensue.”
Deloitte also suggests that this will come from millions of core/dedicated users instead of billions of casual users.
Will it really?
Now that we’ve heard what the experts say, is there any possibility of this happening? The two biggest hurdles facing virtual reality at the moment are hardware costs and the creation of the actual games, apps and video content that will use it.
The front-runner on the hardware front (for now) is the Oculus Rift headset, which was recently announced as being ready for pre-order. Sadly, this first wave of the consumer version is priced at a rather steep $600 (R9 936) and requires a well-specced PC (in the R15 000+ range) to power it, a fact that dramatically limits its appeal.
While Oculus founder Palmer Luckey has defended this price, there’s no denying the fact that this isn’t within the realm of affordability for many people, especially in countries like South Africa where currency conversion, delivery and sundry costs will drive the final local price up further. If it even comes here.
Not the only option
Many argue the point that the Rift isn’t the only VR option on the market. Indeed, competitors such as Google Cardboard are extremely cheap, Samsung’s Gear VR is making progress, Valve Software’s Vive headset is still coming and PlayStation has their own version in development.
Unfortunately, this also leads to competing VR standards, which makes creating games, apps and movies that are compatible with all VR headsets difficult to pull off, a factor that may cool people’s enthusiasm for the medium. Some effort has been put into mitigating this – Razer’s OSVR standard, for instance, is an open-source virtual reality standard that aims to do exactly that – but not all headset makers have bought into the idea.
The VR industry is still in its infancy, however, and we fully expect issues like these to be resolved as more commercial-grade headsets hit the market, so it may well prove to be a moot point.
A good start
Despite these challenges, things are looking good for the widespread adoption of VR: 2016 has kicked off with the launch of the Rift’s initial orders selling out despite the $600 price tag. Clearly, many (us in the office included) are excited about the future of virtual reality.
When 2017 rolls around, we’ll revisit this and see how close the numbers actually were, and if Deloitte’s people had it right.