Whatever Happened to VR?

There are now two competing visions for the technology

Jul 21, 2024

London isn’t built for heatwaves. There’s lots of carpets, a severe lack of air conditioning and a copious amount of crabby commuters.

In conditions above 28°c (82°F) you are better off bunkering down at home. So long as there are no global IT outages, of course. The alternative reality is a rather sweaty and slippery journey to the office.

After enduring my own sun-induced hibernation on Friday, I decided to make a break for it, ducking and covering as I popped to the shops.

My weekly £5 ($6.5) loaf of sourdough needed replenishing — desperate times call for desperate measures, folks.

On the way back from my over-priced yet fashionable local (they also sell tins of sardines for £5), I was startled to see a young lad messing about in his front room.

Not that all fun is now banned in the UK’s capital city, but a couple of things stood out here: the boy in question was wearing a jumper and had an Oculus Quest around his face as he flailed his arms in the air.

This isn’t normal behaviour in a heatwave. But it did at least get me thinking about VR, something I hadn’t thought about for months – a feeling that I expect is shared across the technology industry and policy circles.

All conversations have revolved around generative AI ever since March 2023 really, when OpenAI’s ChatGPT 3 rolled out.

Meta, the maker of the aforementioned VR headset, has started to heavily evangelise for generative AI (typically via its chief AI scientist Yann LeCun).

The company, which re-branded towards the ‘metaverse’, let’s not forget, most recently revealed that it could spend up to $40 (£31) billion on developing generative AI technology this year as it races to catch-up with Microsoft, Amazon and OpenAI.

Apple is also being questioned about its AI strategy, rather than anything to do with VR. Despite boasting that “more than half of the Fortune 100 companies” had purchased Vision Pros, investment analysts wanted to quiz Tim Cook about AI on the company’s last earnings call.

VR simply wasn’t of interest. It just isn’t cool. But the same could be said of generative AI.

For decades researchers like Geoff Hinton were working on large language models. Then there was a major proof point and the technology started to climb up the S-curve.

Having said that, we are all trying to figure out deep use cases for generative AI. And there’s still no agreed definition for artificial general intelligence (AGI), an acronym which has been used to both scare and excite military leaders, lawmakers and business chiefs across the globe.

VR also has its own definition debate, with some people preferring to use ‘spatial computing’ or ‘extended reality’ for the technology. These phrases typically incorporate VR’s cousin Augmented Reality (AR).

But perhaps keeping them separate makes more sense, especially when you consider their real-world applications. VR, thanks to Meta, has a strong association with gaming.

Though the company has spent at least $100 billion on metaverse research, it is known for two main products in the VR/AR sector: Meta’s smart glasses partnership with Ray-Ban and its Quest range.

Both are part of the company’s RealityLabs division, which made an operating loss of $3.8 billion in the three months to the end of March. The Quest headsets, which sit firmly in the VR camp, were the biggest revenue driver here.

But despite being much cheaper than Vision Pro and having a well-defined universe, the Quest headsets seem to have plateaued.

Other wearables are a lot more popular. That’s perhaps why Apple is marketing towards people who like having digital devices on their body for activities other than gaming.

The company originally made much of the product’s ability to help knowledge workers and creators when it was unveiled, but recent Vision Pro ads show the device being worn when someone cooks at home.

The perceived benefit? The consumer can watch video content on apps like YouTube at the same time as preparing a meal or engage with theatre mode when they want to relax.

This telling of the Vision Pro has much more to do with streaming and, in a way, puts the product in the same category as VPN providers, who heavily market to customers who want to unlock additional content from Netflix, Amazon and AppleTV.

In both iterations of VR, whether it’s Meta’s more gaming-focused approach or Apple’s streaming/creativity slant, there doesn’t seem to be any obvious core utility for the consumer.

Going back to other wearables, for example, why do people own smartwatches? Apart from telling the time and becoming a bit of a status symbol, the devices are super-light, can track your heart rate and easily log how far you’ve run, swam or cycled.

A smartphone can do some of those tasks. But it’s a lot heavier and you may want to actively switch off from your personal or work life whilst exercising.

Here, wearables exhibit core utility as well as some other advantages over a hardware incumbent, namely weight.

Now, if we switch our focus back to VR and gaming, it’s hard to see how the VR headsets beat laptops, gaming PCs or even smartphones.

The graphics are usually worse and the titles are less appealing. And the core utility of having most of your senses engaged isn’t as appealing as you think.

What if you want to grab a snack or multi-screen? VR suddenly becomes a hindrance. Likewise, when you take the Apple approach to VR/AR headsets, you can simply use your smartphone, laptop or a TV instead to view content as you cook. And why would you want to go into ‘theatre mode’ if other people are around?

Apart from a finite fanbase, this lack of core utility is currently holding pure VR back.

🤔 Other things in tech and media I’ve found interesting

Biden’s move. The current POTUS has effectively conceded that he’s not well enough to run for the White House in November, but he’s still the leader of the free world. Questions about the 25th Amendment still surround the US media and the Vice President, who swore an oath to upload the US Constitution.

Also, whatever you think of Goalhanger’s The Rest is Politics, their livestream game is very strong. The team attracted more than 30,000 concurrent viewers on YouTube as they immediately reacted to Biden’s letter and endorsement of Kamala Harris. Those sort of numbers would impress top video game streamers.

A big earnings fortnight. Expect updates from Alphabet, Spotify, Apple, Reddit, Snap, Roblox and Microsoft over the next couple of weeks.

Fox wins the RNC fight. More 25 million people watched the finale of the Republican Convention on Thursday. Fox News, which landed the first interview with JD Vance after his appointment as Trump’s VP Nominee, drew in 10.4 million viewers. But everyone is ultimately a loser as traditional TV viewership continues to drop, while consumers continue to embrace video platforms like YouTube and TikTok as well as online audio channels.

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