OCULUS VR’s 300 MILLION DOLLAR QUESTION

The Oculus Hype train is coming, by the end of 2015 it will be deafening.  Current reviews outside of fanboys are almost unanimous VR is an extra ordinary experience. However, watching Gear VR flop does not bode well for the platform when one dives into the reasons.

“The Oculus is a headset designed specifically for video games,” remember that? Well is it still?

Looking past the hype one of the most glaring issues is that the Oculus and other headsets are an optional peripheral, not a necessity like the revolutionary Smartphone that it is frequently compared. The Oculus is a windows PC accessory at that with the cables, drivers and dll issues that entails. The Oculus is not an iPod with a big round button. No! Plain Jane will need to know what a graphics card is and how much memory it has, No! Real world construction/car / tourism / product design industries are old school. Unless the customer insists they will not buy without a VR tour these industries will remain a Pen and paper industry from concept to lease.

The other issue that has come up in Gear VR is how poorly VR integrates into our multitasking, integrated, sharing lifestyles.  A lifestyle where I start watching a movie in the car and stream/upload it to TV in the house when I enter while I share it with friends and grab a sandwich send a text somewhere in between, or type this article with Call Of Duty AW on a minimized tab, switching between VEVO tabs and iTunes while waiting for a text.

There will be three strategies Facebook can follow

1.Do nothing and let things fall where they will – Put it out at a reasonable price point, provide a high-quality hardware experience, and have software/hardware support–understand the Oculus is not an iPod or even an iPad and communicate this to potential consumers, continue to invest while they wait for smartphones to be powerful enough to power VR. The risk is that others will not wait and will produce a flood of cheap devices that will sour the VR experience for many or Oculus goes the way of Google glass/Gear VR and slowly fades into the mist.

Counting on mobile processors to evolve up to teraflops of performance that a GPU currently requires hundreds of watts to achieve, will take many years indeed. Given many consider today’s mobile octocores overkill, betting on “ Snapdragon 10000” assumes that a maturing mobile sector will not settle for good enough performance in a race to the bottom, cost reductions or chose to optimize other components instead.

  1. Maximize the hype machine and Milk Oculus while they can

Flood the VR store with cheap and Free apps, stuff that will run at 140 frames per second on Intel HD Graphics and hope there will be a killer app(or not), drum up the hype machine(Boy have you Facebooked in VR, wow!) and sell as many units as possible while they can.

Do the google: find one crummy game/app/video/whatever put the hype machine behind it, another rugs to riches story on VR ,” boy if this crummy app has made millions, think what my polished VR app will do,”  thereby luring  starry eyed developers and shareholders into making and funding apps for your now vast ecosystem. Repeat regularly and profitably until VR finds a killer app or ends up in the closet with the plastic guitars and drum sets and the motion controllers.

Half the VR fans are deliriously happy the other stands aghast, they hate Facebook but then they always did anyway. VR is dead again for now though.

This strategy hasn’t worked for consoles at all, neither for smart device manufacturers or service providers. It is unlikely to work for a sophisticated peripheral such as the Occulus as the subject platform usually requires significant independent momentum to work.

3.Find their Halo and Create a strong High quality Brand

The Oculus is a headset designed specifically for video games. Well is it?

A lot of mixed messaging is coming from Oculus, Oculus is for awesome movies, it will be great for virtual meetings and product displays (no it won’t) etc. Oculus is young democratic company with an enthusiastic staff, so it will have many voices, but to devs risking their all to create awesome games this sounds like “VR is not a toy to play games with.”  I.e. this is another great platform for your game to die. This will be a deadly sin.

Yes, the Oculus is a headset designed specifically for video games.

Create a Brand that will survive the onslaught of cheap VR devices, with high quality experiences zero in on exclusive killer app games and court AAA and indie devs. Create a long term business, which is very difficult but Oculus has the money and talent to do.

If the Oculus is specifically for  games then Oculus’s main customers are PC gamers, a natural fit anyway since they are acclimated to the many hardships of Windows once you start plugging and unplugging wires installing and uninstalling programs that may alter your registries, dlls, an OS reinstall is just another day in the coal mines. Plus they live in the basement  so no one will see them with the wires sticking out of their head they’ll  just here great stories about VR.

In the meantime Oculus will have a business selling millions of headsets and be able to iterate the design up to the predicted Oculus sun glasses and along the way some other industries will revolutionized, but NO, right now movie, architecture, product design, tourism, etc. industries do not care about VR headsets and not (with millions sold) in the near future either.

Oculus has high system requirements if the PC that powers it is to recreate scenes that players will expect as seen on their PS4s or Xboxes, the vast majority of PC gamers will need to upgrade like its 1998. The mainstream adoption of powerful-enough PC technology to power the experience is not going to happen as more people check their email their phones and type their resumes on chrome PCs. Plus the chick problem (chicks don’t like GearVR).

If there is one thing Gear VR/Google Cardboard proves is that the VR experience is not a killer app by itself, no great hardware needs great software. Simply put Oculus badly needs exclusive ground breaking  VR AAA games.

Creating a killer app game in 2015 is no small task. COD Modern Warfare had immense production values and averaged user ratings of 6/10. Destiny cost hundreds of millions and left many disappointed ditto Titanfall. Yet Oculus will need many varied AAA experiences or face the same fate as Wii U, Windows phone, Blackberry Z10 did on launch with the added pressure of convincing gamers to upgrade when new more powerful hopefully cheaper graphics hardware rolls around in 2016.

‘’Unity 3d 5, Unreal Engine 4 definitely enable developers to deliver something  incredible to potential to deliver the experience gamers will come to expect on VR, however it will come at a cost” says  iHome Tour creator Thomas Ngulo who is now working on a ultraviolent sci-fi AAA PC shooter  game Metal Shock. It is novel for featuring a mission in a brothel complete with sex scenes, a Game of thrones meets matrix. ”Doing research for Metal Shock with photorealistic strip clubs, no one has relevant experience with this platform. You’re going to require a continuous cycle of creation play testing  destruction then  repeat, the narrative has to be modified along the way to flow with the mechanics, you were already talking about AAA assets here 4k res textures for diffuse, spec, normal, occlusion, refection, sss maps a 3d model with multiple lods and complex animations. Then you find out it doesn’t work in VR do you ship a 6/10 game or do you spend more money, I had to drop plans for Metal Shock VR in the planning stage.”

So, how much are we talking about?  After spending money on decent customer support and patches devs may be looking at 300 mill in sales to break even, a big problem given 0 install base. Which explains the reluctance of CEOS/studios to commit to the platform.

POST EDIT : Do the google.

Do the google a socio economic technique where the wealthy /corporations manipulate the unwashed masses to subsidize some of their otherwise very expensive activities usually R&D and employment screening. Pick a crummy app/video /game/startup turn them into a rags to riches story, everyone loves those. Open the gates, stand back and watch them try to cross the desert, crocodile infested rivers and claw up the Great wall. Natural selection does the rest for you- 99 .99 percent die (in the case of the app store 99.999999999999 die) and you have your killer app. Also among those who are about to die are innovative and highly driven individuals, just a few drops short of luck, perfect employees. Ask any amiable contractor who works with diff shops about career men. Highly capable individuals/departments whose singular and exclusive goal within an organization is to guarantee a their next paycheck, not to do the job too fast, ship the product with bugs so it needs to be fixed (if you ship a windows OS that works they won’t buy the upgrade) or outright cynically sabotage the product/processes (defense contractors/too big to fail banks). Through “the google” a corporation can find teams / individuals who can innovate and deliver and avoid careermen (Milkmen?). Look out for the google.

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