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Virtual reality gaming: VR trends & sourcing opportunities

March 18, 2021 by Tom McGrenery (Content Lead) Leave a Comment

Image credit: Uriel Soberanes

Gaming continues to be a strong and growing part of the consumer electronics industry, and in the virtual reality (VR) sphere, new opportunities are opening up. Long in something of a rut, VR gaming is gaining traction across the consumer leisure market, with high uptake for products such as the HTC Vive and PlayStation VR.

In the COVID-19 era, the market for VR gaming has seen significant growth as countries around the world were forced to enact public health lockdown. People started spending time on VR gaming during lockdown, and VR gaming providers are trying to make behavioral change permanent. HTC, for instance, slashed the cost of a Viveport Infinity annual subscription by 75%, from over US$100 per year to just $27 in 2020.

 

“Immersiveness has definitely been one of the megatrends in the gaming industry over the last 10 years or so,” said PlayStation CEO Jim Ryan in an interview with The Washington Post. “I think platform-level features like the ones you’d see such as 3D Audio and haptic feedback being put in the hands of a great game developer are going to allow this phenomenon of immersiveness [to be] taken to the next level. … I think you’re going to see something really powerful and really transformational quite quickly, and that impact will grow over the life of the platform.”

Image credit: HTC

VR gaming is at a tricky stage: the available content isn’t rich enough to satisfy the hardcore market segment, but the hardware is too expensive for casual players to easily buy in. “In the eight years since the first Oculus VR headset was released, the opinion of gamers has largely been mixed,” Andrew Nichols wrote for CEPro in February 2021, “with core audiences interested in the technology but unwilling to shell out several thousand dollars for a proper system, while more casual fans were content with experiencing VR at a friend’s house or during E3, PAX or other gaming expo.”

But things are changing. The VR gaming market is expected to grow at a CAGR of 32.75% from 2021 to 2026, according to forecasts by ResearchandMarkets released in 1Q 2021. Entry costs are coming down – not to the point, yet, where buying a headset is a decision on the same level as buying a new game, but certainly more in line with other peripherals. A gamer in the US, for example, will typically pay about $300-800 to get started in VR. Importantly, VR systems now cater to a range of buyer profiles: you can buy the Oculus Rift S or Oculus Quest for $399, but if you are going all-in on VR, $799 gets you an HTC Vive Pro.

That change in the availability and functionality range or VR options is paying off in market growth.  According to NewGenApps, by 2025 the worldwide user base of AR and VR games is expected to increase to 216 million users.

 

Key sourcing opportunities in 2021

Image credit: Sony

For the majority of sourcing professionals, the most relevant VR products will be accessories. Unless you’re working for Sony, Microsoft or another tech giant, you probably won’t be setting up your own VR ecosystem anytime soon. But you can find opportunities with products such as VR headsets, wrap-around display screens, wearable controllers and sensors, the chargers to power them up, cases to protect them, and cables or wireless devices to connect them.

This sentiment has started to shift, however, with more gamers clued in on the power of VR thanks to the medium finally offering a “must-have” game with the release of “Half-Life: Alyx” by lauded game studio Valve in March 2020. VR headset prices also have dropped considerably in recent years, as evidenced by the $300 PlayStation VR headset meant to be used with the PS4, and the $600 HTC Vive.

Beyond price and general consumer interest, the technology behind VR has significantly improved since 2012. Motion tracking controllers for players’ hands have been updated to feel more natural and more like limbs/tools while in-game than in previous VR generations, and developers have put greater emphasis on eliminating VR-related motion sickness. Don’t expect VR to be in every gamer’s household by the end of 2021, but certainly keep it on your radar.

 

Into the future

That massive shadow looming on the horizon? It’s the PlayStation VR 2 – the much-anticipated virtual reality system for Sony’s next-gen console. But don’t expect it this year. “There’s still a lot of development underway for our new VR system, so it won’t be launching in 2021,” wrote Hideaki Nishino, PlayStation’s Senior Vice President for Platform Planning & Management, in an official blog post earlier this year. However, although the company isn’t detailing the full specs or release dates just yet, Sony will start issuing dev kits for its next-gen VR headset soon. Which means now is the time to get in touch with cutting-edge suppliers who can make the products that will be in demand as soon as PSVR2 launches. Sony has filed a number of patents for technologies that could well feature in the product, including an anti-motion sickness system and a means for people to watch their friends play games from the perspective of a spectator within the virtual environment, such as watching a racing game from the side of the track.

 

 


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Filed Under: Trends Tagged With: Consumer Electronics, electronics, gaming, tech, trends, virtual reality

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