We’re constantly told that VR is great. But why aren’t we buying?
Virtual reality is the talk of the technology and marketing communities. It’s something that promises out-of-this-world experiences.
Experiences where we can replace real world environments with ones created by software.
But is it what we really want, or is it all hype?
In 1716, economist and financier John Law set up the Banque Générale. It was the first bank in then debt-ridden France to issue paper notes.
A year later, he took over the Mississippi Company. A company granted monopoly status for the trade and development of France’s North American colonies along the Mississippi River.
Convincing the French public the area was rich in valuable natural resources, with great potential for profit, public demand for company shares increased sharply.
Mass hysteria broke out as the French people did all they could to get hold of shares in the scheme. Share prices jumped from 500 to 18,000 livres.
By 1719, John Law gained the rights to produce new coins and collect all French taxes. In effect, he controlled France’s foreign trade and its finances. Where he saw a big opportunity.
The bank printed more paper money which the public could use to buy more shares in the Mississippi Company.
At this point, the company had issued 625,000 shares in a stock market boom that spread across Europe.
The profits never materialised, though.
The complex linking of the company’s shares with the state’s finances ended in complete disaster in 1720 when the value of the shares plummeted to nothing.
Millionaires went bankrupt in a matter of months and The Mississippi Scheme led to one of the first ever stock market crashes.
A scheme which promised the world and delivered nothing of the sort.
Virtual reality will find itself in a similar position unless something changes.
It’s found itself in no man’s land between the initial hype and the immersive experiences it creates. In a conundrum.
Technology companies, the media, Mark Zuckerberg. We’re listening to these people tell us that VR is great, but I’m sceptical.
Because there are problems with the fundamentals of VR.
Yes, the immersive experiences are impressive at first. Everything is exciting.
But after a while the tech issues and loading times seem more obvious, the discomfort is there, and there’s still the motion sickness, of course.
Motion sickness, in particular, is a real issue. Because people will spend less time playing on their games. Which means less interest in games, and a smaller market a for VR game developers.
Sales of VR products are nowhere near high enough to tempt game developers to keep on developing more games at this rate. It isn’t financially viable to do so.
You can’t sell its features either, you need to demonstrate it. And there are too many demonstrations needed to hit the sales numbers needed for it to be sustainable. Similar new technology is probably needed to sell it – that we don’t have.
And to cap it all off, most games don’t even need VR to improve the gaming experience.
We were taught this a few years ago with the VFX-1, iGlasses and the Nintendo Virtual Boy. We’ve seen the same with motion controlled video games and 3D movies at home and in the cinema.
Yet, there are instances where VR does work.
Ford use VR to review their cars through the manufacturing process.
NASA train their astronauts and engineers for outer space missions through VR.
Bavaria’s State Criminal Office are even using VR to prosecute people who witnessed Nazi war crimes.
But these are outside the homes and outside the mainstream market. So, long term, is it a business product rather than a consumer one?
This is a big worry for VR.
Because these are markets where audiences are small and where the money for this type of product isn’t.
John Law fled France dressed as a woman after the Mississippi Scheme and the country took 80 years to recover, and could only do so by raising public taxes and starting again.
Tech companies and investors have jumped on the bandwagon and are gaining good PR coverage to convince us that PlayStation VR and the Oculus Rift is great.
It’ll eventually get found out.
Just like the Mississippi Scheme, the hype will die down when people realise the current business model isn’t sustainable – when the money is all gone.
But it’s got further than any other tech fad of its kind.
There is potential. And we feel as though we should buy.
But are we really going to?