AMD demonstrated its commitment to the future of virtual reality during last month’s E3 2015 by pulling together big name industry executives, content creators, and retailers to discuss the practical future of consumer virtual reality. The results were a refreshingly frank, open and encouraging conversation.
AMD is betting big on virtual reality. It’s lost ground to competitors in recent years, faltering in the performance GPU market and struggling to regain momentum against the likes of nVidia despite winning big in the next-gen console hardware race.
But in Los Angeles at last month’s E3 2015 the semi-conductor giant took a bold gamble on the future of an industry and threw itself into the virtual reality arena. By the close of the week, one thing was clear: when it comes to VR, AMD means business.
To that end, they held a series of dedicated events throughout the week, designed specifically to showcase their latest GPUs powering the latest virtual reality experiences. However, the company’s boldest move by far was to gather a selection of consumer electronics retailers and manufacturers, throw them in a room with assorted VR developers and community members, and let them verbally duke it out over their vision of the VR industry’s evolution. AMD called it the VR Advisory Council, and it was a rare and refreshingly open debate on the future of an industry.
Heavyweights like Best Buy, BAFTA (British Academy of Film and Theatre Arts), DSG (Dixons Store Group), The Visual Effects Society, 20th Century Fox, HP, HTC, Alienware, Microsoft, Unity and Futuremark shared the floor with representatives from the VR development community including content creators Reload Studios, Ragnarok, Zypre (The Production Studio behind ‘First’ the Wright Bros short) and Unity Technologies (not to mention Road to VR).
MC’d by AMD’s VP of Alliances, Roy Taylor, topics and agenda were broadly defined in advance, but freeform conversation among delegates was encouraged throughout. I’m going to focus on two of the main topics at the event and try to summarise highlights of the discussions that arose around them.
The Virtual Reality Market Opportunity
The challenge with a brand new industry, and for those looking to invest in it, is understanding just what market potential exists there. Given that no consumer VR hardware is yet on sale (remember, even Samsung’s Gear VR is still an ‘Innovator Edition’), this is the realm of business analysts and industry commentators. Clearly we’re in the land of educated guesses and financial crystal balls here, but Tony Danova from Business Insider (BI Intelligence) pulled together some interesting figures to serve as the basis for this initial discussion.
Opinions differed here as to whether the figures quoted were realistic, with opposing estimates from the council varying—somewhat understandably perhaps. BI Intelligence estimates that by 2020, 25 million VR headsets across mobile, PC and console will have shipped, equating to a $2.8 billion hardware market.
Whilst we know of the major players coming to market in late 2015 to mid 2016—HTC/Valve, Oculus, Sony, and Samsung—AMD are currently tracking 11 other, as yet unannounced headsets working their way to market.
A representative of Unity Technologies stated their belief that the mobile VR market will eventually dominate, with 50-60% of the overall VR market. They cited the prevalence of Google cardboard—which according to Google passed the 1M shipped mark some months ago—as an example of its possible adoption.
20th Century Fox’s representative on the other hand was bullish about the ‘tethered’ PC VR headset market, saying that Valve’s HTC Vive could sell as much as 1 million soon after launch. Sony’s Morpheus, should hardware production meet with demand, may ship between 1-3 million units dependent on price and supporting content, according to the rep. Oculus on the other hand are a relative unknown, at least as far as brand recognition and experience in the marketplace is concerned. Aside from the existing developer kit owners “It’s all about content” was the feeling from Fox. Mobile, on the other hand, didn’t have content compelling enough to really break through at this point.
Additionally, there was an opinion that, in this first flush of early hardware, there will be a demographic who wants to own this hardware because it’s exclusive, desirable and new. To that end ‘premium’ platforms (which interestingly seemed to indicate Valve’s Vive to some present) may be desirable because of their higher estimated price. Conversely, going in at too low a price may actually be detrimental to the industry.
The broad range of predictions here speak to just how new and untested virtual reality as a consumer prospect really is. Realistically, we simply won’t know how things will pan out until headsets hit the market later this year, with Valve’s Steam VR and HTC’s Vive believed to launch in time for Christmas. It’ll be really interesting how opinions and strategies alter over the next 12 months as real figures start to emerge.
