Just a few months ago VR was just a series of impressive tech demos. Now at least four companies have announced VR headset launches from fall 2015 through the middle of 2016.
When Facebook (FB) acquired Oculus VR last year for $2 billion, the social networking giant immediately validated virtual reality and ushered in a wave of competition. After saying for more than a year now that the consumer version of the Oculus Rift will ship “when it’s ready,” Oculus VR revealed that its headset will launch in Q1 2016.
Meanwhile, MergeVR has a $130 headset launching in time for the holidays, and the HTC Vive headset will also be available this fall. Next year will see Sony Morpheus headset ship in the first half of the year in addition to the Oculus headset. Additional VR devices, including a consumer version of Samsung Gear VR, are likely to announce launches as well.
“Oculus is a bellwether for VR, and its launch window sets a reference for the start of the first VR cycle,” Tim Merel, managing director of Digi-Capital, says. “Facebook has the financial capability to maximize installed user base growth by subsidizing pricing, which could be a factor on both early market growth and competitively.”
Travis Jakel, analyst at Piper Jaffray, forecasts that 2016 will see sales of 12.2 million VR headsets. Oculus Rift is expected to account for 3.6 million of those headset sales, and Oculus VR will also benefit from the projected 5 million Samsung Gear VR mobile headset sales in 2016. HTC Vive is forecast to sell 2.1 million units and Sony Morpheus 1.4 million headsets.
Merel believes the different VR platforms each have advantages: Facebook as a parent and Oculus’ consumer awareness are huge advantages for Oculus. HTC Vive has amazing high-end technology, HTC and Valve’s experience in mass consumer markets, as well as the games ecosystem experience that Valve brings to the table. Sony (SNE) has a massive installed base of PlayStation 4 users, an integrated technology platform, and games ecosystem experience.
Oculus has not revealed its price point yet, although the company said pre-orders will become available later this year.
“Oculus came out and said the Oculus consumer should be slightly more than the Gear VR and have mentioned they are planning to keep it in the $200-$400 range,” says Jakel. “I would venture the guess it will be $300 for Oculus. The Gear VR will most likely remain unchanged at $200 and HTC will probably be a bit more expensive than Oculus with a price tag of about $400 -$500.”
Gene Munster, analyst at Piper Jaffray, believes Facebook will deliver a major marketing campaign to promote VR in 2016, in an attempt to appeal to more consumers than just the early adopters who have been waiting for VR to become a reality for years, if not decades. “VR has been limited to geeks so far, but Oculus Rift will get market share and make VR real for the average tech consumer,” Munster says.
Brendan Iribe, CEO of Oculus VR, believes there will be a shakeout on the quality of VR that consumers will demand. Oculus VR hopes to lead that quality bar by delivering something that’s very comfortable and that ultimately delivers the sense of “presence” where consumers actually believe they’re in these virtual worlds. Less expensive or lower quality VR headsets could come and go, leaving the main players in control of what could be a $30 billion VR industry by 2020, according to Digi-Capital.