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VR's crazy week punctuated by a Palmer Luckey no-show

Weekly roundup: Oculus, PSVR and Google highlight a busy week as analysts make wild predictions

Virtual reality was certainly top of mind for many in the industry this week. Not only did Sony's PSVR finally get a series of mixed reviews from consumer and mainstream press, as its somewhat muted launch draws near, but Google probably gave Samsung fits with its Daydream View unveiling and the world watched an agonizing 2.5-hour presentation on VR from everyone but Palmer Luckey at Oculus Connect.

Luckey, who as founder of Oculus would have ordinarily been one of the key speakers at the event, was conspicuously missing. His absence, and indeed the fact that no one during the show even uttered his name or alluded to his absence, spoke volumes about Facebook's real feelings towards him and possibly about his future with the company. It felt like Oculus just collectively put its fingers in its ears and screamed "La, la, la!" repeatedly.

In case you somehow missed it, last week Luckey was called out for funding a pro-Trump "shitposting" group, and numerous developers questioned whether they could support Oculus anymore. Some even called for Luckey's immediate resignation from Oculus. Beyond that, fellows within Oculus' own Launch Pad diversity initiative questioned whether they could support Oculus in the wake of the revelations about Luckey. The fact that Oculus sent out Ebony Peay Ramirez, the company's head of diversity, to announce that Oculus will commit $10 million to "diverse programs for virtual reality," felt like a direct reaction to the circumstances surrounding Luckey. Not addressing the elephant in the room, however, felt incredibly awkward. It's also worth noting that the event stream's Twitch chat was made moderators only - clearly a deliberate move to circumvent any inappropriate discussion that could remind viewers of that aforementioned elephant.

"Oculus is now running the risk of splitting its user base. Developers making games for Vive know that the controllers and room-scale are built in, but how many Rift owners will also be Touch owners and use room-scale?"

The keynote conference as a whole also unfortunately dragged terribly. Rather than keeping their message succinct and on point, Facebook trotted out every person on the team it could muster to dive into the science of VR, the challenge of VR and full-on prognostications about where it's all headed in far too much detail. Games took a backseat to the idea that social VR will forever change how we communicate as a species, and Oculus spent way too much time talking about avatars, as if they had just invented them. To top it all off, they sent out an under-the-weather Michael Abrash to essentially give us all a TED talk on VR and what could be coming in five years, because, you know, the previous two hours of conference wasn't long enough and what better way to end a conference than with a detailed science discussion? It's ironic that messaging is such a weak point for a company that's all about communication.

When Oculus did devote some time to games in VR, we got to finally hear the price and date for the Touch controllers. At 200 bucks, the Touch makes an already expensive proposition incredibly cost prohibitive. Oculus, which also announced room-scale support, has slowly but steadily brought itself on par with Vive, except with Valve's VR system you get everything in one package. Oculus, on the other hand, is now running the risk of splitting its user base. Developers making games for Vive know that the controllers and room-scale are built in, but how many Rift owners will also be Touch owners and use room-scale? I will say, based on my experience with them at E3, the Touch controllers feel very natural and are great to use, but the $200 price tag is going to be tough to swallow.

To its credit, while it's a no-brainer, Oculus did reinforce the idea that they need great software to push VR. It's encouraging to see that they're willing to invest another $250 million (on top of the previous $250 million) into the ecosystem to make that happen. Some may have criticized the Facebook purchase of Oculus for $2 billion, but Facebook is a behemoth with a big war chest, and by leveraging that chest the company is helping to push the VR medium forward at a much faster pace than it would have progressed otherwise. If you're a VR enthusiast, you should be grateful for that.

This week was also the week that all the analysts came out of the woodwork to provide their own estimates on the VR market - probably not a coincidence given that they knew it would be a big VR news period. SuperData has predicted that the overall VR hardware and software market will ultimately reach $30 billion by 2020, while Juniper has offered an incredibly bullish prediction of $50 billion for the hardware side alone in 2021. IHS was the most conservative of the bunch, forecasting total VR entertainment and headset spending to come in at just over $11 billion by 2020. I'm not confident which forecast I'd lean towards more, but the fact that they vary so widely is a sure sign that anyone reading these estimates should understand that they're just that, and should be taken with hefty grains of salt. The truth of the matter is that forecasting exact market conditions for nascent technology is incredibly hard. Juniper itself explained, for example, why its own mobile games forecast of $10 billion (issued in 2006 for 2009) ended up being off by over $4 billion.

Elsewhere on GamesIndustry.biz this week

Veteran developer Amy Hennig spoke openly about the crunch problem that still persists in AAA

The Chinese Room co-founder Jessica Curry has called for more diversity and talked about the absurdity of people not feeling safe in the workplace

The Washington State Gambling Commission has demanded that Valve take action to stop illegal gambling around CS:GO skins

First Contact, a group of Blizzard and Starbreeze vets, have landed $5m for their AAA VR studio

The eSports world gained more outside investment from Steve Aoki and Memphis Grizzlies co-owner Stephen Kaplan

Bethesda has backtracked and PS4 versions of Skyrim and Fallout 4 will be getting mods after all

In other news

Gamigo sees revenues rise in positive H1 results

VRChat raises $1.2m in funding

Koji Igarashi's Bloodstained: Ritual of the Night will be published by 505 Games.

Universal is making a Gears of War movie

A class action lawsuit against Valve and TmarTn has been dismissed by a Federal judge

Racing studio SimBin reopens in Manchester

Related stories

VR chasm of disappointment becoming more of an abyss?

Analysts weigh in on whether the latest Oculus announcements this week will move the needle for VR adoption

By James Brightman

Latest comments (12)

Justin Biddle Software Developer A year ago
$200 for a controller? Occulus really do seem to have a disconnect with reality. They don't just need killer games to justify that. They need The One Game. A game that towers above every other game in existence to make the price tag appeal to the masses they seem to think will flock to VR. Good luck with that
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Klaus Preisinger Freelance Writing A year ago
What could have started as a simple monitor replacement and demoed well as such, has already turned into the biggest dumpster fire in a long time.
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Roland Austinat roland austinat media productions|consulting, IDG, Computec, Spiegel OnlineA year ago
James, we've both been to our share of keynotes over the years. I'm at OC3 and thought that the keynote was one of the better choreographed ones - might be different when watching it via Twitch.

The price of the great touch controllers is tricky and Oculus knows it. How else do you explain "Asynchronous Spacewarp" that allegedly reduces the amount of needed frames rendered to 45, making VR possible on something as low as a GTX 970? And a PC that costs only 500 Dollars alias PS4 with a camera?

Very curious to know why NVIDIA and AMD worked with Oculus on that tech - don't both want to sell their most recent graphics cards?
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Craig Page El Presidente, Awesome EnterprisesA year ago
$250 million? Isn't that enough to make between 2 and 5 AAA games?
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It is a shame that the energetic tinkerer that ignited this latest phase of VR has become so toxic that he has to avoid attending the companies major event. And if rumors emulating from the OC3 event are true then the ramifications of his position could prove untenable.

I have mixed feelings about the event - a lot of what was revealed could have been told sooner, and the holding of this event it turning more into a beauty contest than a dedicated reveal. I can not fault the presentation, and the level of polish and there are some interesting new announcements.

But [you knew there would be one], the price of 'TOUCH' is concerning, and the question of its release date will be an ongoing source of consternation - and underlines the issue that is a factor in Mr. Luckey's toxicity, having made bold claims of a second part of the year launch only now to see the reality as an end of the year release. Also, the reveal of three cameras needed for true 'room-scale' seems to boost the price past the $199 claim closer to $280, and reveals an uncomfortable little truth about the actual capabilities of 'Constellation' - just too many bold claims from Oculus and their absent founder, proven later to be far from accurate (for whatever reason).

Now with Sony PSVR launched - we can sit back and really see the appetite for an over $900 VR system (minus the $1,000 PC) competitor to HTC Vive ($800) that will only be available - if all goes well with Oculus' shipping aspirations - in December smack bang in the middle of spending for the holidays!
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Petter Solberg Freelance Writer & Artist, A year ago
To top it all off, they sent out an under-the-weather Michael Abrash to essentially give us all a TED talk on VR and what could be coming in five years, because, you know, the previous two hours of conference wasn't long enough and what better way to end a conference than with a detailed science discussion?
Well, let's be fair, you can't really blame Abrash for Luckey's mistakes (personal choices), which seems to completely overshadow this and other reports from Oculus Connect. I enjoyed this part of the talk, and it was pretty lightweight with just the right amount of detail. And to their credit, Oculus has always been fairly transparent about the limitations of the current VR gen (and slightly less transparent about the actual price point of their consumer releases) , and the fact that it takes time to develop this tech. Touch was never promised to launch alongside cv1 from day one, and despite HTC and Valve's decision to rush their controllers to market, Oculus kept developing Touch to make sure the controllers actually work well with as many different applications as possible, not just games. (In December we'll know if it was really worth the wait.).

I get why people are upset by Luckey's involvement with the shitposting campaign, and it's a good thing that people won't stay indifferent. That said, I think credit where credit is due still should apply.

Edited 6 times. Last edit by Petter Solberg on 8th October 2016 8:49am

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Jeff Kleist Writer, Marketing, Licensing A year ago
As I said,
In the previous thread, I believe there is a distinct possibility Lucky is already fired, and that they're simply giving him a space of plausible deniability before he "goes to find the next challenge"

Oculus's gamble is that existing owners aren't the type who are very price sensitive, but it certainly does feel like they see Touch as an add-on to the standalone headset than the existing one. They likely correctly assume the game pad is just fine, but I also see them eliminating that version, blowing them out over Christmas in favor of a vive style unified bundle in line with the current Xbox controller

. Please remember, Samsung was pushing the Xbox Bluetooth compatibility for a reason, roomVR is not going to be a big thing no matter how much enthusiasts and artists want it to be. remember as well, Oculus is selling a business tool as much, or at this point more than a consumer device. They're looking for half the PCs that roll of the line next year, along with Xbox Scorpio to be compatible, and I don't think they're that worried about Vive long term. HTC doesn't have the resources to fight Facebook, and they're building a base of hardware support. And don't forget, they've split the base from day one with the GearVR and now their own consumer platform. The rift is for enthusiasts and business. The whatever and gear are for people who want to watch a VR movie and chat with friends, and both will exist on the same ecosystem which is what they really want.

I'm still skeptical of whether any of this will work out. What I saw yesterday assures me they're at least going down swinging.

Edited 1 times. Last edit by Jeff Kleist on 8th October 2016 8:53pm

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In the previous thread, I believe there is a distinct possibility Lucky is already fired, and that they're simply giving him a space
Have to agree @Jeff - the toxic nature of some of the VR forums means that this kind of discussion gets flamed in seconds.
But have felt that all the signs seem to point to a separation from OVR for PFL having taken place. Not sure how this will impact the three legal suits that are in process of being prosecuted, though speculation is that FB had no intention of funding the legal defence and with a departure of this nature the ex-founder would have to dig into his vast kitty?

An ignominious end to this chapter of the story, with surprising undertones to the situation that befell Jaron Lanier back during Phase Three of VR (exiting VPL under a major cloud). I think there may also be one more shoe to drop before the whole saga is put to rest as well.
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Paul Jace Merchandiser A year ago
Luckey, who as founder of Oculus would have ordinarily been one of the key speakers at the event, was conspicuously missing. His absence, and indeed the fact that no one during the show even uttered his name or alluded to his absence, spoke volumes about Facebook's real feelings towards him and possibly about his future with the company.
I think you hit the nail on the head James. I doubt a company as diverse as Facebook would simply give Luckey a free pass on his "overly enthusiastic" controversial post. Although they might give him an option of being demoted to something equivalent of demoting a police officer to a parking meter bike cop. Or, as Jeff pointed out, they may have already nullified the situation but have decided to hold back the announcement for a more appropriate time. But rather he's still technically employed by the company or not his days of being the public face of Oculus are over.
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Jeff Kleist Writer, Marketing, Licensing A year ago
@kevin/Paul

I know if I were the opposing attorney in those cases, I would be using that action as an illustration that we were dealing with an impulsive unethical person (which may or may not be actually true, just that manipulating the jury's emotions is my job). Personally if I were Facebook I'd start playing just make a deal regardless, as from what has been made public there is likely some merit to some of the accusations, enough that when combined with this kind of traction (particularly after Friday revelations) will only make it that much harder to win. Oculus showed some great stuff this week, they seem to have a broad and diverse strategy to bring people into VR. I hope it works out, and I hope they have an amazing Black Friday sale ;)
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Anders Larsson CEO & Co Founder, Lightbulb CrewA year ago
it seems they are suggesting the market this year will be around 1bn, with around 200M being software. So we are talking about 10x market in 4 years time. Sure it might be possible, but it for sure will not come from full room VR.

I do hope VR succeeds, and I like the Sony initiatives However, as to full room, or even standing VR, that is going to be a TINY minority of the market.
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Jeff Kleist Writer, Marketing, Licensing A year ago
@Anders I'm 100% with you. The biggest VR market is going to be the gear VR and its equivalent.

RoomVR is too expensive, requires too much work, and people don't like it when they're not blind. Oculus's new goggles may warn you about walls, but how do they do with cats and coffee tables? Sitting with a pad or hand controller is where it's at for 95%
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