Thursday, January 14, 2016

Oculus Rift: Consumer Perception vs. Industry Reality

I had originally started my last post (Technology Adoption Lifecycle) to focus on and discuss Oculus Rift and the wild expectations people had for it, but it started to get too long so I decided to split it up into two posts.

Obviously, being an emerging technology market, I've been interested in and monitoring the development of Virtual Reality (VR) for a while. One of my classmates in business school had an early Oculus headset and I was able to play around with it for a few minutes. From the one basic simulation that I tried, I wasn't too impressed with it, but can definitely see the potential it has.

Similar to what I saw on my demo (image via Martin Caine)

For those not familiar, Oculus VR is a company that grew out of a highly successful Kickstarter campaign which raised almost $2.5 million. (The Updates page of the Kickstarter has a great timeline of events, from the launch of the campaign way back in 2012 to the present). The goal of the founders was to develop VR headsets for gamers, but grew into something much bigger with the campaign's success. 

When Oculus opened up pre-orders for the production version of the Oculus Rift last week, may were surprised and displeased with the high price. At $599, it was significantly higher than the Kickstarter "developer kit" price ($275 for Early Backers, $300 after that); not to mention this did not include the computer required to process graphics and software (PCs with the recommended specs cost around $1000), or the still-in-development controllers (if I had to guess, I'd price them between $100 and $200).

Oculus Rift headset and forthcoming 'Touch' controllers (image via Metro)

The negative response to the relatively high price is directly correlated to my last post because of the disconnect between what the founders had originally intended and the inflated expectations that arose with the increase in media attention and speculation.

An article that I found spelled this out well explained, "This isn’t a massive consumer-focused launch — it’s more of a slow rollout to the eager early adopters with deep pockets." (ExtremeTech)
That is, we are much closer to the right of the Technology Adoption Lifecycle curve and barely out of the Technology Enthusiasts zone (Kickstarter backers are firmly in this camp).

As I'm thinking about it, maybe there isn't a true shift as I previously wrote; rather, its an aspirational shift. Whether it's due to social media or other pressuring factors, consumers want to be considered Early Adopters, but are still pragmatically constrained to wait until products hit the mass market. 

In short, the Rift is not bringing VR to the general population as many thought. The product and industry are still very much in its infancy and will take a great deal longer to mature. Unless it gets lost in the Chasm, of course; which I believe is a real possibility and Augmented Reality (AR) simply leapfrogs it.

If the industry does survive the jump, I think we'll know in the next 18 months or so.
Everyone else will know it's here when Apple makes a headset.

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