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On 6 May 2015, Oculus VR announced its plans to release a consumer version of its virtual reality (VR) headset sometime in the first quarter of 2016. This announcement was largely followed by a great deal of excitement by VR enthusiasts, who are currently waiting for the pre-orders to begin toward the end of 2015. However, the new device is expected to cost somewhere near US$400 at launch and the company has announced that it will require a powerful and relatively expensive PC to play content, bringing the total cost up to US$1,500 for some consumers, according to the company. Due to this prohibitive price point for entry along with other factors, the Oculus Rift may face some challenges in expanding beyond the enthusiast market.
One important factor for the future of Oculus Rift is the timing of its release. The general range of first quarter 2016 for the Rift’s launch means it will likely come out after the release of the HTC Vive, which is tentatively scheduled for some time in November 2015, but possibly before Sony’s Project Morpheus, which has so far targeted the first half of 2016 for its release date.
While coming out after the HTC Vive will likely be a detriment, the effect might be minimised by the price of the HTC Vive, which according to HTC will be at the higher end of VR headsets. Launching before Sony’s Project Morpheus would likely be a hugely positive factor for the Oculus Rift, as the Project Morpheus will have the built in advantage of the large install base of the PlayStation 4, which had retail value sales of nearly US$2.0 billion globally in 2013. In addition, Sony’s Project Morpheus will likely be a much cheaper entry into VR headsets, as the PlayStation 4 will likely cost nearly half as much as a computer capable of properly running Oculus Rift games and videos.
Content will also be a critical factor for both the initial success of the Oculus Rift and other VR products. While there may be a large number of consumers willing to buy VR products, they will need software to justify the purchase of a relatively costly item. The Oculus Rift has been in development for some time, but without robust enough catalogue of software, consumers may not stay engaged with VR headsets, and eventually lose interest. And there will likely need to be more than just video games to keep consumers occupied, and a strong collection of VR films would greatly help the Oculus Rift’s launch. While film studios have expressed interest in producing content for VR devices, much of their commitment has been somewhat tepid, likely waiting to see if these new headsets catch on.
While the initial success of the Oculus Rift will be important, its success in the years after launch will be critical in determining if this is a new mode of entertainment or a passing fad. Manufacturers within consumer electronics made a large push to bring 3D televisions into consumer’s homes starting in 2010, an effort that proved to be mostly ineffective. 3D televisions were considered too costly and the glasses too inconvenient. In addition, many consumers at the time had just recently upgraded their television sets, and did not want to purchase a new one. There are some similarities with the Oculus Rift, as the device will take a somewhat sizeable investment to use, can mostly only be used privately by a single individual, and might seem costly to gamers who recently upgraded their static consoles. Oculus VR will therefore need to be proactive to avoid 3D television’s fate and create as much content as possible while constantly looking toward ways to make the Oculus Rift easier and more convenient for consumers. If not, Sony’s Project Morpheus will likely use that as an opening for their product, which will likely cost much less for consumers to use.
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