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Now's the time to get into VR - but be realistic about its returns, says Palmer Luckey
Now's the time to get into VR - but be realistic about its returns, says Palmer Luckey
March 16, 2016 | By Kris Graft

March 16, 2016 | By Kris Graft
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More: VR, Business/Marketing, GDC



A lot can happen in five years, especially in a tech field as fast-moving as virtual reality. For Oculus VR, it started with an 18-year-old Palmer Luckey making headset prototypes in his parents’ house. Then came more duct-taped prototypes, some serious evangelizing from prominent tech figures like John Carmack, a multi-million-dollar Kickstarter campaign, a grassroots VR developer movement (that continues today), and a $2 billion Facebook buyout.

Oculus VR is the company responsible for kicking off enthusiasm for a whole new generation of VR – today’s VR tech has the support of not only a growing and engaged VR development community, but also companies with the resources and business interest to push VR in the mainstream, eventually.

The next momentous occasion for Oculus VR comes on March 28, the launch day for the company’s flagship high-end VR headset, the Oculus Rift. At a press event a day before the start of Game Developers Conference, we sat down with Oculus founder Luckey to chat about the launch and what game developers ought to keep in mind if they’re pondering the jump into VR.

So the commercial launch, of course, is coming up. What's going through your mind right now as far as any kind of anxiety or expectations?

It's not really anxiety. It's just dealing with the reality. We've got two weeks until we launch. We've been working on this for years and the pressure is on.

We have to nail this launch we need to get everything right. Everything is going good so far. It is definitely an anxious time.

So what does a perfect launch look like?

A perfect launch is [one where] everybody gets their Rift, they plug it in, they have no problems on the PC side. They have no problems on the software side. And then they spend the next week playing VR games nonstop.

That would be the perfect launch. The reality is that when you ship any hardware product out of the lab and out of testing into the homes of countless people, you're going to end up having problems.

You have to be prepared for that. You need to be prepared to make bug fixes, to make changes, to help people get things working if they're having issues. We're really prepared to do that.

It's really important. In this last week, you know that every bug you can quash in the lab is a huge amount of customer service effort and troubleshooting effort that you're knocking out a week from now.

After it launches what does the VR market look like in the near term, say a year from now?

The near term a year from now? I don't know, what do you want to know? I think there's going to be a bunch of people using our headset. I think there's going to be a bunch of people using Gear VR. I think there's going to be people using other stuff.

"Developers should be realistic. Don't believe the most optimistic things the analysts say. Especially when those analysts don't actually know anything about VR."

I think there's going to be a lot of VR devs making a lot of money. I think you're going to see a few people have some real breakout hits. They're going to make a big pile of money. I think a lot of other people are going to see high attach rates even if they're not the most successful app just because VR is so new and there are so many different things that are happening.

It's a relatively limited set of content right now. Relative to, let's say, a console years after launch. I think a lot of developers are going to have a lot of success.

Your involvement on a daily basis today -- what do you do on a daily basis?

I do everything. I help with software. I help with the studio's team, the publishing team, the game's team. I've been playing through a lot of these games to help them polish them right before launch. I like to do hardware stuff, but honestly hardware was locked quite some time ago. We're in the manufacturing stages of just cranking these things out there and getting them out to people as fast as we can.

And then, of course, stuff like this where I talk to you and tell you what I'm doing.

When will this type of VR be mass market, do you think? How do you define "mass market" with something like this?

I don't know. I'm not going to try to define mass market because everyone has a different definition…People say 2016 is the year of VR. I think they're right in a lot of ways, but that doesn't mean that this is the year that VR becomes as popular as the iPhone. It doesn't even mean that this is the year it becomes as popular as Palm Pilots.

It's going to be a long gradual road to getting hundreds of millions of users, or even tens of millions of users. But I don't think that you have to be a mass market mainstream product to be a success. You can be very successful selling a smaller number of units and continuing to build the ecosystem. You don't have to build something that everybody buys.

Brendan [Iribe, Oculus co-founder] predicted [a] 50/50 [split] as far as Oculus goes, business-wise, [between] non-games and games. Is that about right still?

That sounds about right. I think that number is going to shift over time. Right now, the games industry is the industry that knows how to build real time photo-realistic 3D environments so they were able to just jump onto this VR train real fast.

Most of the people who are already own or are willing to purchase high-end PCs with high-end graphics cards are gamers, so you're going to see disproportionately more games in the early days.

I think as time goes on you're going to see the split change where you're going to have a smaller ratio between games and other content. I think games will continue to grow.

To be clear I'm not saying there will be less and less games. I think there's going to continue to be more and more and more games. I just think that the non-gaming applications are going to grow even faster.

Is there anything you would say to devs who are thinking of getting into VR?

Yes, two things. First: now is the time to start making something in VR, even if you don't plan on launching it. It is a really good idea to start experimenting and see what you can learn. Even if you're not going to launch something, it is good to have experience in virtual reality so that if it makes sense for you to get into it, you're able to.

I think the people who are going to be hurt the most by virtual reality are going to be developers who give absolutely no attention to it, and don't think about it at all, and don't experiment with it at all, don't work on getting their tech with it at all. Of course, I'm biased. I believe VR is going to become hugely successful and then dominate the technology industry.

If I'm right, people who aren't spending any time at least thinking about VR now are going to have a tough time catching up with the people who are at least putting some time into it.

At the same time, I'd say developers should be realistic. Don't believe the most optimistic things the analysts say. Especially when those analysts don't actually know anything about VR.

It's going to take time for virtual reality to become truly mass market and successful, so people should scale their efforts appropriately. Don't go out and say, "Hey, we've got to get into VR. There's going to be a hundred billion dollars in revenue by the end of 2018. If we can capture just 1 percent of that then we're going to be a billion dollar company." It's not quite going to work like that, is my guess.



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