VR Heartbeat

April 18, 2017

The state of VR, AR, and MR as gathered from Game Developers Conference.

CES 2017: VR Headset


Virtual/Augmented/Mixed Reality is the next hot thing in tech, particularly for gaming, and it has been a year since the HTC Vive, PlayStation VR, Oculus Rift, and others have been available to consumers. After several game title releases, some metrics on how these products are making money should exist – right?

Every year, the game industry gathers together at the Game Developers Conference to show off cool things we’ve done, share hard-learned lessons, trade development tips, and to network through parties. It was there that those desirable data points were found at the panel aptly named “Dear VR: Where’s My Money?”.

That panel focused on a general discussion about VR revenue for clients, with panelists from ADVR and Immersv leading the discussion.

The main conversation revolved around identifying differences in monetization strategy from other platforms and the consensus was that there aren’t any. You just need to keep in mind that surviving off of ads with < 1 million users, per platform is much harder than say, on mobile.

However, Mihir Shah from Immersv did share that his company is seeing VR users being more engaged than mobile, with 2-3 times more engagements. He quoted a range of 3-10 engagements per day, per user that converted to $7+ of revenue.

Although the panel couldn’t pinpoint considerations specific to the VR space, they agreed that the market doesn’t seem to have price sensitivity yet. Their justifications were that it’s a large group of early adopters and the price of entry to the platform is already expensive leaving the cost of software relatively cheap by comparison.

While they continued to express this fluidity through experimentation in the growing marketplace, Arnaud Dazin from ADVR expressed that there are really 3 different VR markets: Console, PC, and Mobile – and you need to understand their user bases before choosing your business model.

Arnaud maintained that console consumers have established their high preference for premium content, and recommended to avoid advertising on these platforms.

Towards the end of the panel they reminded the audience that business models are for after release. Platform manufacturers and tools developers are providing plenty of subsidization for research & design development efforts to get projects off the ground.

 

Unreal Engine 4 Takes Center Stage

As companies are looking to define how they want to enter the market, Unreal Engine is looking to prove itself as the industry tool of choice.

Tim Sweeney, CEO of Epic Games, shared the stage during the “State of Unreal Engine” keynote with ILM, Chevrolet with The Mill, and Andy Serkis (via recorded video). Each showcased how they had used the raw power of Unreal Engine’s “out of the box” features, or free access to the source code,  to add, innovate, or streamline their creative development endeavors – particularly in relation to VR.

ILM covered briefly that they used parts of Unreal Engine for rendering some quick scenes in Rogue One, as the result met their high fidelity standards and the tools enabled faster workflows to cover gaps in production schedules.

The Mill dominated most of the presentation, displaying how they integrated Unreal’s real-time rendering with their proprietary simulation software so they could offer on-site customization and test footage of car commercials with Project Blackbird.

Tim Sweeney also came out swinging against their competitors, claiming that Unreal Engine’s market share (as measured by revenue) is “more than double the nearest competitor across all platforms, generating more than $10 billion across the industry.” He also went on to claim that “more games are powered by Unreal Engine than all other licensable engines combined when looking at the top 100 list on Steam.”

I highly recommend checking out the full video on Epic’s own post covering the event.

All in all, GDC supports what most people have assumed: VR is imminent.

Nathan Harris

Nathan is a Software Engineer with years of experience in the game industry starting out as a journalist before moving on to study for a career as a developer. At L4, Nathan is leading incubation of game projects in addition to other client work.

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