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Oculus Closes Many In-Store Demo Stations as VR Headsets Prove a Hard Sell

Facebook says it will continue to invest in virtual-reality technology despite evidence it’s not catching on with many consumers.
February 9, 2017

Oculus built it, but they didn’t come.

Facebook’s virtual-reality division created a network of 500 free demo stations in Best Buy stores to give people a taste of VR using the Oculus Rift headset. But according to a Wednesday report from Business Insider, about 200 of the demo stations will close after low interest from consumers.

People who worked in the stations told the publication that they would often not give a demo for days at a time. An internal memo obtained by Business Insider described plans to close many demo stations, citing “store performance.” Best Buy still plans to sell the headset.

The Rift is one of several high-profile consumer-oriented virtual-reality headsets released last year, but the technology is still in its early days. The headsets are bulky, and those offering the best experience, like the Rift, require a physical tether to a pricey PC. Even once you’ve got the gear, there still isn’t that much to do in VR.

Sales thus far seem to reflect this. Market research firm Canalys estimates that just over two million VR headsets shipped last year (it puts the Rift in third place, with almost 400,000 headsets shipped, behind Sony’s PlayStation VR and HTC’s Vive). That’s a small number compared to video game consoles. More than six million of the current top seller, Sony’s PS4, were sold just during the holiday season.

Oculus spokeswoman Andrea Schubert said that the network of demo stations contracted for “seasonal” reasons, and that the company is concentrating on offering demos at hundreds of Best Buy stores in the largest markets. She also said that Oculus is going to hold events to offer live demos of its virtual-reality technology at stores and in local communities during the year.

“We still believe the best way to learn about VR is through a live demo,” she said.

Several analysts who cover virtual reality say dropping many of the demo stations after the busy holiday season could make sense. But they also noted the challenge in selling virtual-reality headsets, which are still clunky and unfamiliar to many people.

“I think in a store environment getting people to sit down and go through that experience of getting a headset on and getting set up is quite a difficult thing to achieve,” said Geoff Blaber, a CCS Insight analyst.

Blaber expects that it will get easier when companies can convince consumers there’s more to do with VR than just play games, and as more headsets are released that don’t need to be wired to a computer. Oculus has demonstrated a wireless headset, though it hasn’t said when it could make its debut on store shelves.

Brian Blau, an analyst for Gartner, said the decision to cut many of the demo stations looks like a reflection of the overall state of wired virtual reality. Although the technology is mature enough to put something in people’s hands, it’s not mature enough for mass-market consumption. He expects this to change over the next year or two as headset makers improve their devices.

“For me, this is not a technology that’s going away, but one that’s going to take time to mature into what people want it to be,” he said.

That’s also the view of Facebook founder Mark Zuckerberg, who led his company’s charge to buy Oculus for $3 billion in 2014 and has said it will take a decade for VR to be adopted by the masses. He reiterated his long-term stance during the company’s latest earnings call last week, and asked investors to be patient. Facebook plans to “invest a lot in this,” said Zuckerberg, even though Oculus won’t “be really profitable for us for quite a while.”

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