Why VR isn’t here yet

From https://finance.yahoo.com/news/apple-lead-faang-performers-again-144241234.html

Hardware agnosticism

Most apps are hardware-agnostic. Sure, there are things you can only do on Android or Apple. But the major social platforms all work on every device. So do most productivity suites, and any significant game.

Alyx’s hardware support list. Where’s my Quest?!

Unsolved problems

VR tech still has plenty of issues. The Quest was the first really compelling user experience I was able to hand to technophobes who could use it well within five minutes. So we know what the UI looks like, maybe.

VR lacks a social business model

Tech is a necessary, not a sufficient, factor in sustainable consumer VR. This isn’t about the number of games in an app store, or who has the most installed headsets. Because long-term, sustainable VR isn’t about hardware. It’s about monetizing the social platform.

From https://www.statista.com/statistics/382260/segments-share-revenue-of-apple/

What’s the business model?

Nobody knows what the VR business model looks like.

  • Will people sign up (Netflix like) and then use it, paying a monthly fee?
  • Will companies subsidize VR use by pushing advertising or clever product placement, like Youtube?
  • Will it be a consumption-based economy, or one where avatars and skins and premium abilities cost more, like some free-to-play games or Snapchat filters?
  • Will we pay for storage and consumption, like Dropbox or AWS?
  • Will we pay a per-transaction fee, like an app store tax? Or will the virtual world include its own currency, playing the float, some variant of Bitcoin or Etherium?or something similar.
  • Will it be a form of rent for property, the way Second Life worked some of the time?
  • Maybe it’ll be many worlds — “I’ll meet you in Azeroth.” Vernor Vinge’s Rainbow’s End has a collision of two incompatible worlds (what he calls “Belief Circles”) at its climax. But a major theme is the crowdsourced nature of that future. Most traditional media haven’t noticed the rise of demand-then-business content creation (Complexly is a good place to start.) And there’s always Patreon.

Great fortunes come from business models

If history teaches us anything, it’s that the long game in VR will be something we don’t expect, or a commingling of these business models. Great fortunes aren’t made from new products, they’re made from new business models.

“The firm rarely produced the engine itself: it had the purchaser buy parts from a number of suppliers and then assembled the engine on-site under the supervision of a Soho engineer. The company made its profit by comparing the amount of coal used by the machine with that used by an earlier, less efficient Newcomen engine, and required payments of one-third of the savings annually for the next 25 years.”

Watt and Boulton’s fortune came primarily from selling the engine’s output as a service based on how much more energy it generated. That was the true innovation of the steam engine.

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Alistair Croll

Alistair Croll

Writer, speaker, accelerant. Intersection of tech & society. Strata, Startupfest, Bitnorth, FWD50. Lean Analytics, Tilt the Windmill, HBS, Just Evil Enough.