The Virtual Reality market is well and truly on the fast track of growth globally. According to a recent study, the total number of users of VR-technology is all set to reach 43 million, by the end of 2016. While computer – with a 45%+ device share – is still the largest platform for the deployment of Virtual Reality technologies, the mobile platform (with nearly 30% share) is the one growing at the highest rate. Games, somewhat predictably, make up more than three-fourths of the total volume of VR-content across the globe. Virtual reality is expected to be one of the hottest technologies in 2017, and we here look ahead to some interesting VR trends to watch out for next year:
Surge in number of VR companies
In 2015, there were only around 175 companies dabbling in the virtual reality technology. That figure will almost double by the third quarter of 2017 – and by 2020, the number of VR companies will hover around the 800 mark. The number of VR developers has grown by almost 15 times since the middle of the last decade. With the promise of high financial returns and profits (and the sheer excitement of the still ‘relatively new’ technology!) – the sector is likely to surge further.
Rapid increase in the number of users
Rapidly increasing demand is the single biggest factor behind the proliferation of VR companies worldwide. Compared to 2014, the global user-base of virtual reality devices is expected to grow by almost 450% (90 million vs 0.2 million) by 2017. As per industry forecasts, the number of VR-users will nearly double by the next year, reaching 172 million by the end of 2018. Heavy users of VR technology (read: hardcore gamers) will make up 10% of the total ‘virtual reality population’ (~9 million people), while the number of light gamers will touch 23 million. With growing acquaintance with the technology, the number of early adopters is also likely to jump from 26 million in 2016, to 58 million in 2017 – an increase of nearly 123%.
Note: On average, 4 out of every 10 people have a high degree of interest in virtual reality. Nearly 27% of the world’s population have already used at least one type of VR headset already – and this usage will become more and more frequent in the next few quarters.
Burgeoning market size
While virtual reality has grown at a very rapid clip (from both the supply and the demand side) since the turn of the decade, the real spurt is yet to come. By December this year, the value of the global VR software industry will be a modest 0.5 million USD. By this time next year, the market value is expected to inch towards USD 2 million. The YoY increments will be even larger from there on in – and by 2020, VR software will be a USD 25 million sector. Similar increases have been predicted for the VR hardware industry as well. From its current valuation of a tick over USD 3 million, it will grow to USD 4.8 million by 2017 – and a whopping USD 16 million by 2020. It’s safe to say that virtual reality will witness unprecedented growth in the coming years.
Increased focus on VR content
The innovative user-experiences that VR devices deliver will not be the sole USP of the technology. Mobile app and game developers have already started to focus on the creation of high-quality, engaging virtual reality content (applications) to keep users hooked. What’s more – the concept of VR being almost exclusively related to next-level gaming and entertainment is gradually dissipating. In 2017, it can be expected that VR will find acceptance (in various degrees) in many other domains – right from healthcare and real estate, to travel, education, and even military affairs. The onus is on VR developers to conduct customer researches, find out the demand trends – and create content/applications accordingly.
Note: By 2017, a large section of the ‘VR population’ will be interested in the actual experience and utilities that virtual reality delivers – and not in the technology per se.
More headsets and other devices
If 2016 was the ‘Year of the VR Headsets’, 2017 will be the same – on a much higher scale. The adoption figures of devices like Oculus Rift, HTC Vive, Microsoft HoloLens and Google Daydream View would all show significant upswings – while there will be a slew of newer VR devices being launched as well. The Fove and Razer headsets will also become more popular. Google Cardboard – considered by many as an indirect reason behind the flop show of Google Glass – will continue to show expansions in its user-base too.
Note: The story behind Oculus Rift is, arguably, the most interesting over here. The Oculus VR company raised a mighty impressive USD 2.4 million via crowdfunding on Kickstarter, grew rapidly over the years, and was finally snapped by Facebook – for USD 2 billion.
VR in movies
In March 2016, the world got its first ever full VR movie theater – at Amsterdam, Netherlands. Its name, rather aptly, is ‘The Virtual Reality Cinema’, and it is the first of a fairly long line of similarly innovative movie theaters that will soon be opened in various European cities. Virtual reality are increasingly being made use of by CGI professionals involved in movie-making as well. ‘Independence Day: Resurgence’ might have turned out to be a disappointing movie – but its use of 3D VR graphics was widely appreciated. ‘Assassin’s Creed’ – an upcoming film adapted from a video game – will also have extensive utilization of virtual reality tools. In the next year and beyond, expect VR to become an integral part of special effects – particularly for action or sci-fi flicks.
Moving beyond ‘sights’
Virtual reality and Augmented reality (AR) are going to offer more than simply enhanced viewing experience for users. A common trend among VR app developers across the world has been the application of haptic feedback – for creating VR headsets that allowed people to actually ‘feel’ the elements in the world of virtual reality (like the way HTC Vive does). Experts feel that we are not far from witnessing the arrival of the VR devices that supported other senses – like touch and smell – as well. It will be all about using the technology to interact with VR environments in more ways.
Note: A bit about the main difference between virtual reality and augmented reality here. VR creates immersive simulations for viewers with the help of computer-generated graphics – primarily to re-create certain elements from the real-world. Augmented reality, on the other hand, actually builds on the real world by using computer graphics and enhancements.
More ‘free VR experiences’ for first-time users
In 2015, as many as 1.2 million units of Google Cardboard were delivered by The New York Times to its subscribers – for free. Other popular magazines and publications (e.g., Outside Magazine) did the same as well. All of these campaigns were launched to get first-time users onboard – and they were all more than successful in getting people interested in the powers of VR technology. In 2017 too, most ‘early adopters’ will be able to enjoy their first VR experiences for free. Since the ‘wow factor’ of VR devices is uniformly high, most of these ‘early adopters’ will be ready to pay later – for continued use of the technology.
Note: There is a possible downside of providing a large global audience with free/low value global experience though. A section of people can show the so-called ‘snob effect’ – equating low-value with low-quality. It might be difficult to transform these users to actually paying public later.
9. More powerful VR processors
For all its growth and adoption, the VR market is still in a nascent experimentation stage. Developers are striving to deliver that ‘perfect VR experience’ (with the concept of ‘perfect’ continuing to evolve as well). By the end of 2017, there should be a larger number of VR processors available – that are more powerful than the current set. The standard refresh rates of the new processors will be 75 frames-per-second or more, since anything less than that results in a clearly discernible lag. VR screens should also undergo a revolution – with average screen resolution levels becoming at least 500 dpi (dots-per-inch). A crisper, optimal virtual reality experience is awaiting us!
10. The cost factor
As we move towards 2017, the diversity in the price range of VR devices is steadily increasing. At one end of the spectrum, there is Google Cardboard – which costs all of USD 20 (and that too, after the first free experiences we talked about earlier). At the upper end, we have Microsoft HoloLens – combining VR and AR services for users, and carrying a price tag of USD 3000. Oculus Rift and HTC Vive (USD 599 and USD 799 respectively) are not particularly cheap either. For users who wish to stay on the low-end of VR hardware, there are quite a few cool options to choose from – like Google Daydream View and Samsung Gear VR. Those who are interested in the technology and have deep pockets will spend big on VR – but VR is not going to become an exclusively premium service in the foreseeable future.
11. VR as the face of adventure sports and activities
From roller-coaster rides to drone races, virtual reality has started to leave its imprint on several thrill-a-minute sporting activities. In North America, Six Flags – a US-based amusement park corporation – has already started creating customized ‘VR coasters’ at different places in North America. The first-person view (FPV) experience that VR offers is behind its incorporation as the main feature of drone racing as well. Players will be able to check out live feeds from videos fitted inside the drones. Over the next couple of years, sports that involve enhanced visuals will be a big craze.
12. Revenues from VR content
Although mobile app developers have started to make VR applications for different fields – gaming will dominate the virtual reality ecosystem for at least next 5-6 years. The total revenues generated from VR games will be well in excess of USD 300 million – with console games, on average, being priced in the USD 5 – 40 range. It should be noted in this context that VR will serve mainly as a marketing channel on the mobile platform in the next year or so – with most mobile VR apps falling in the sub-$10 price category.
13. Improved network speeds
For VR and AR to make any headway, network and bandwidth connectivity speeds have to go up significantly. It can be reasonably expected that, in 2017, the faster networks will allow VR headsets to seamlessly connect with backend servers (cloud-based). Higher network speeds are also required to minimize latency – which can ruin the overall VR-experience for users. Network providers will have their plates full, while trying to create glitch-free cloud environments in which peer-to-peer interaction between multiple VR devices will be a possibility.
Note: VR developers across the world have reason to be encouraged by one particular trend – the cost of creating VR content is gradually declining. Making high-performing VR applications is still not a ‘low-cost thing’ by any stretch of the imagination – but average costs are coming down. This trend should grow stronger in 2017.
14. VR as training tools
Virtual reality will emerge as one of the most convenient training and development platforms, in 2017 and beyond. The technology has the potential to replace – or at least complement – manual training and teaching, with immersive communication methods and one-to-many reach (not something that human teachers can provide on a large scale). Yet another advantage of VR-powered training is the provision of real-time feedback (along with course corrections, as and when required). Training will become more and more decentralized – with VR allowing users to set up ‘classes’ practically anywhere.
The average size of VR headsets is likely to become smaller (than the present lot) over the upcoming years. 2017 might also witness baby-steps being taken towards incorporating user-inputs in virtual reality environments (instead of ONLY the content created by developers being visible to them). A section of app developers and market analysts feel that vendors might struggle to keep up with the escalating demands for VR devices, as the number of ‘early adopters’ swells. The future is all set to be VR-driven…and it is going to be one exciting ride!
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