Connectivity

Winners and Losers Begin to Emerge in VR Hardware Race

As we predicted in the past, affordability and convenience seem to be driving sales of headsets.

Consumers are voting for virtual reality with their wallets.

Sales of VR headsets have been undeniably sluggish, with up-front hardware requirements and a lack of blockbuster content making the devices a hard sell. But we’re finally starting to see some headset manufacturers rise and others struggle when it comes to selling their wares.

Clearly faring poorly is Oculus, the VR company that was acquired by Facebook for $3 billion in 2014. Last month, it made the decision close down a string of in-store demo stations following lack of interest from consumers. Now, in a bid to stimulate adoption, it’s slashed $200 off the price of its Rift headset and motion controllers, so that they now retail as a set for $598.

Meanwhile, the New York Times recently reported that sales of Sony’s PlayStation VR headset, which sells for $500 with its controllers, have surpassed even the company’s expectations. It had sold over 915,000 units as of February 19, which was around four months after the hardware was launched. That puts it on track to well exceed its internal target of selling one million of the headsets in the first six months.

The news shouldn’t come as too much of a surprise. Our own Rachel Metz predicted this exact situation last June. At the time, she argued that the Sony device had two main advantages over those made by Oculus and HTC: first, it was in and of itself more affordable; second, it only requires a $350 PlayStation 4 game console (that many people already own anyway) to run, rather than a powerful gaming computer.

The news from Sony and Oculus, then, suggests that we were right: pricing and the ability to run the headset with existing—or affordable—supporting hardware make a potent combination for those looking to experiment with VR. Clearly, Oculus realizes that’s the case. Last year it announced that it was working on a prototype device that didn’t need to be tethered to a computer, but it’s not clear when that might become commercially available.

In the meantime, it will be hoping that its reduced pricing can convince consumers to give it a try. The reality may turn out to be rather different.

(Read more: New York Times, Reuters, “Why Oculus and HTC Need to Watch Out for Sony in VR,” “Behind the Numbers of Virtual Reality’s Sluggish Debut,” “Oculus Closes Many In-Store Demo Stations as VR Headsets Prove a Hard Sell”)

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