Virtual Reality Rides Its Second Wave

NEW YORK — As virtual reality enters what many see as a second cycle of hype, industry insiders and a small-but-brave group of veterans from the first wave insist that things will be much different this time.

They’re confident, they say, because the technology is vastly improved, the costs are lower and because content will be plentiful.

But first a step back. The Nintendo Virtual Boy, a platform released in 1995 and unceremoniously killed off the following year, has been the sector’s whipping boy ever since. Virtual Boy was maligned for its lack of compelling content, as well as an experience that produced as much vomit as thrills.

“It didn’t do very well,” Joost van Dreunen, CEO of Super Data Research, and a keynote speaker at the Virtual Reality Summit here, said in his understated assessment.

And the product didn’t fail because consumer interest in VR was low at the time. In fact, VR was already ingrained in pop culture. It was a key plot driver in Lawnmower Man, a horrendous sci-fi horror flick that hit theaters in 1992, as well as 1994’s Disclosure, a much-better film that starred Michael Douglas and Demi Moore and was based on Michael Crichton’s book.

Even the older set had a VR hook on which they could hang their headsets — who can forget that classic episode, “A Virtual Murder,” from season 10 of Murder She Wrote, which had Angela Lansbury donning a VR headset and motion-capture gloves? (It aired in 1993, but you can catch it on Netflix.) 1995 brought us Johnny Mnemonic.

One reason Nintendo’s contraption didn’t work out: Virtual Boy supported a whopping library of 14 games, including VR-enabled remakes of Tetris and Super Mario Bros. Oh, and the graphics were crummy.

“There was no content to speak of … and it offered a very disappointing experience for an end user,” van Dreunen said. “We are now used to having an app store with a million apps.”

VR is poised to do better this time, van Dreunen said, calling Facebook’s $2 billion acquisition of Oculus in 2014 a validating moment for the VR industry that triggered a surge of investments.


“Facebook has spoken … and VR is going to be a thing,” he said of the prevailing attitude that resulted.

He said the VR and augmented reality AR markets are expected to raise $2.8 billion in funding this year, and predicted the market for VR (hardware and software) would reach $45.1 billion in size by 2020.

In the meantime, he said, the true momentum of the VR market is still two to three years out, suggesting that hitting that next big ramp-up would be a grind. “This is where the work starts,” he said.

A follow-up panel featured two survivors from the early days of VR — Tony Parisi, now vice president of Web and open technologies at Wevr, a content studio and distribution platform for VR experiences; and Philippe Van Nedervelde, CEO, senior virtual worlds designer and co-founder of E-spaces, who has managed to make a living off VR even during all of these lean years.

Parisi shed some more light on why consumer VR crashed in the 1990s: Electronics were too expensive, most computers didn’t have the horsepower to support 3D graphics and there was no broadband.

Through it all, Parisi said he kept his eye on VR, and admitted that he was “blindsided” by the Facebook-Oculus deal.

Though people like to say that VR “went away” after that mid-1990s crash, that wasn’t the case, Van Nedervelde said. Development and tech around VR continued, particularly in the commercial and military sectors.

“What’s really back is the consumer aspect of VR,” he said, noting that a big difference today is that there are more than 20 manufacturers jockeying for position in an industry that has seen the rapid rise of multiple head-mounted displays.

Another big difference is the VR market has access to a generation of people who know how to make content — games, animation, architecture and industrial design — for what amounts to a new computing platform, Parisi said. And, in his opinion, consumers are ready.

“Today, we have good enough technology at a good price that enables all of those players vying for position and consumer market share to have a go at it,” Van Nedervelde said, noting that new, more powerful, pixel-packed smartphones and headsets with greater fields of view will only improve the experience.

Apple, which has yet to reveal its VR play, could “blow the category out of the water” as it did in 2007 with the smartphone and the introduction of the original iPhone, he predicted.

They also took a stab at which platform is best positioned to grab the most territory early in the race among the higher-end products — the Oculus Rift, HTC Vive or PlayStation VR.

Both agreed that Sony’s platform is the “dark horse” because millions of homes already have PlayStation 4 consoles, reducing one piece of possible friction, and because it will operate under a closed system at a reasonable price (Sony’s VR platform starts at $399).

In the earlier keynote, van Dreunen was also optimistic about PlayStation VR’s potential market strength. “It will allow developers to build something that will work seamlessly,” he said. “It’s a plug-and-play offering.”

But all three view mobile VR as a sweet spot, given the massive penetration of smartphones that can be paired with a headset.

They are also enthused that Hollywood is gravitating to VR: Ridley Scott, for example, is working on a mysterious project. And Wevr is working with big-time producer Jon Favreau on a VR project, Parisi said. Details haven’t been announced.

“Hollywood is going to play a massive part in this,” Parisi said. “For my money, VR is a storytelling medium as much as it a game-playing medium.”

This time around, VR has an ecosystem of cameras and stitching software that enable everyday consumers to make 360-degree videos that can be downloaded and shared.

“We didn’t have that in the first VR wave,” Van Nedervelde said.


If VR and AR are to reach millions or even billions of users by 2020, as some have predicted, the technologies “won’t get there by building one app at a time,” Parisi said. VR is “fraught with friction” under the current apps-based model, he noted.

The way to scale VR content, in Parisi’s view, is to build it on an “immersive Web” platform that isn’t under pinned by app stores, but one that lets users simply link over to those experiences and “just plays.”

Though apps models and relatively closed systems are driving the early VR market, the industry will need to shift to Web-based standards in order to scale up, he said.

Today’s WebGL technology brings 3D graphics to desktop and mobile browsers without the need for discrete apps, and, in fact, is what’s being used for Google Cardboard viewers.

A next step is a standards project called WebVR, Parisi said, available now as a developer-build for Chrome, Firefox and Samsung’s Internet browser for the Gear VR (in beta form, anyway). The 1.0 version of the preliminary spec is out, but “there’s a lot of work to do,” he said.