#1131 – Freedom to Roam in VR Entertainment

The constant technological advancements in VR are seen with the continued investment by Meta into a new range of headsets, and a new “laser focus” on establishing their ambitions of the what the Metaverse will represent. Meanwhile, the reality of generating revenue from the operation of VR is proven by the commercial entertainment sector, with announcement of new venue openings and the launch of new technology to drive the market. 

Meta Rings the Changes in VR

More leaks regarding the social media giant Meta’s attempts to revitalise their VR plans and Metaverse strategy. Many wait eagerly for announcements at the planned September event. Previously called Oculus Connect, the rebranded ‘Meta Connect’ will reveal many new developments in content and operation functionality regarding their VR aspirations, but there is one development that has already had the lid lifted. 

The corporation has revealed they intend to launch their brand-new VR headset, with the ‘Meta Quest Pro’. With a more compact form factor, and updated hardware and software from the original Quest 2 hardware, the system is returning to the black styling. Whereas the Quest 2 was fundamentally a Quest 1, painted white and sold at a significant loss to try and instil the ambitions of Meta to see a billion VR users on their architecture. The ‘Quest Pro’ is a full price platform (speculated at costing around $1,200), incorporating a new pancake lens design compared to the Quest 2’s bulkier Fresnel lens. The platform also focuses more on the see-through capabilities, with a MR style approach, as the platform is aimed at professionals rather than consumers, pushing its use in ‘Horizon Workrooms’ (Meta’s remote working app service), and positioning the ‘Quest Pro’ as offering the opportunity to replace the laptop. 

This is a significant gamble for Meta, as this system hopes to define their Metaverse aspirations, soon to be in direct competition with Apple who are about to launch their own MR focused headset. Following a hiring freeze within Meta, the company has been reported to be “laser-focused” on the launch of the new system, as an attempt to rally investor support after crippling drops in the corporation’s stock price. The success of this new launch is seen as a make-or-break strategy for the corporation’s ambitions in controlling this new strategy, and if it fails to ignite, the market will see major restructuring of the operation – even impacting the highest management.  

The rivalry with Apple has escalated following the privacy change on Apple iOS, that forced a loss in ad revenue to Meta. This is lost revenue that plays its part in following revenue decline and a situation that would even see Meta investors sue the company over withholding this information. At the same time, we see Meta undertake the unusual strategy of developing their own physical retail space concept. Launching in California, a test location called ‘Meta Store’, the outlet proposes to demonstrate and sell the ranges of VR (‘Meta Quest 2’), AR (‘Ray-Ban Stories’) and cloud-based devices (‘Meta Portal’). This represents the rushed interpretation of the iconic ‘Apple Store’ approach, even including a VR demonstration area – coming from an operation that has had a long animosity towards commercial VR arcade operations.

While many supporters of Meta point to the speculated success in Quest 2 sales, there are undercurrents and, whilst some sources say there are 12m units in the market (though the corporation does not reveal sales data), there is a high return and re-sale element taking place, with owners tiring quicky with their VR purchases. This is further compounded by a lack of new release titles and is best illustrated in the ambitions of ‘Horizon World’, the online VR collaborative game and social environment. After exiting a long beta phase and being rolled out internationally, internal leaks reveal the platform has failed to generate the expected adoption (with Meta claiming a monthly user-base of 300,000 in February). This in comparison to competitive environments such as RecRoom and VR Chat that are still dominating this aspect of the emerging VR market with millions of active users. A failure for Meta to generate interest in their siloed flavor of Metaverse could be disastrous. 

Meta’s Metaverse Woes

So great is this failure that Meta recently bowed to community calls altering the need for Quest 2 users to use Facebook accounts to log into their headsets. This move is seen to try and placate some criticism of the corporation’s harvesting of data from the users. It is this access to valuable information of VR users on the platform that was seen to allow Meta to significantly subsidise the cost of the hardware. This loss of information, which was used for ad revenue, would have hurt the business plans and reopened concerns regarding the implementation of age restrictions. The login is now reverted to the creation of a Meta Account – although many industry observers complained this was the same as the Facebook account, just with just a different name and still forcing a login to use their VR purchase. 

The reality of what the Meta Connect event will actually represent in the timeline of the corporation’s actual VR plans can be best illustrated by what happened some three-years ago, when Oculus revealed their plans for a brand-new location-based entertainment application using the then ‘Oculus Quest’ standalone VR headset. Demonstrated at Oculus Connect in 2018, the company ran attendees through the ‘Oculus Quest Arena’ – a system allowing six players to compete in a free-roaming experience based on the ‘Dead and Buried’ VR Western shoot-out game. This offered the ability of using cover with physical obstacles mapped into the virtual world, supported by a MR viewing tablet of the players’ progress within the virtual experience. All this was pitted at the adjacent TheVOID installation, invited to show at the event. Now, some 42-months later, we learn there had been no intention to release the platform, and those who paid to support the SDK were never able to leverage the hardware blocked from further progress. This was a sad lost opportunity to internal issues within the corporation against commercial activities – another possible victim of the Meta assimilation.

At the same time, Meta seems to have favored a strategy for their consumer business focused more on their consumer social media and apps-based business than on games. Meta is rumored to have an aversion to consumer gaming but has still acquired game developers such as Beat Games, Downpour Interactive, and BigBox VR – however, this seems more towards securing control of popular content than building a production line of game titles. The removal of support from AAA game development exclusives for the ‘Meta Quest 2’ was underlined with the announcement, in July, that the proposed exclusive “Oculus” VR game from Ubisoft, based on the ‘Splinter Cell’ IP, had been cancelled, along with several other projects from the French publisher. Ubisoft had made great milage at the previous Connect conference, to announce their exclusive development for the Quest 2. The news of the cancellation was felt to be the start of a migration by AAA developers away from the MobileVR processor platform, and its limitations, mindful of the Sony and the PSVR2 release on the horizon.

But things continued to get worse, with the news that the American Federal Trade Commission (FTC), had sued Meta to block their acquisition of the VR fitness app developer Within – famous for the development of ‘Supernatural’, a fitness experience in VR that has been ported onto several headsets, including the ‘Meta Quest 2’. The FTC reasoning for this move was regarding concerns of competitive practice (trying to buy its way to the top), in controlling and dominating this business. This comes as Meta was seen to be undertaking a string of acquisitions, such as just recently with Ready at Dawn Studios, Downpour Interactive, Twisted Pixel, Unit2 Games, and many more, to try and cement their dominance in the emerging market.

Another major situation that struck the social media and VR giant was the news that they intended to reverse their subsidizing of their ‘Meta Quest 2’ line of VR headsets and accessories, raising the price (from August) by, in some estimations, $100 (33-percent). This move was blamed on unexpected price hikes in components and a need to “…continue investing in moving the VR industry forward” (as stated in the surprise corporate Tweet). This move takes place only 24-months after the launch of the hardware and the company promised to offer, for the remainder of the year, a free copy of ‘Beat Saber’ (from BeatGames) with all subsequential headset sales, as an appeasement. This news shocked the VR community, as it seemed to clearly illustrate problems with the subsidized corporate strategy – the price hike seems to have come just after the changing of the login and datamining revenue collection. 

This hike also came as Meta announced its first ever decline in revenue since going public in 2007. Growth has declined by 1-percent over the last quarter ($28.8b in three months to June, from $29.08b). Of this announcement, along with a downturn in advertising revenue, it was revealed that $2.8b of this loss had been caused by the Meta Reality Labs, the division handling the VR operation of the firm and driving the aspirations of market dominance in the Metaverse (comprising much of the previous Oculus VR operation). Meta is having to deal with the fallout from this news, as well as the looming concerns regarding announcements of competition gaining ground in the market.

 The Growing Competition

An FCC filing revealed that Pico plans to release their own new VR headset ahead of the ‘Meta Quest Pro’, boasting many of the same advanced features and hoping to offer direct competition to controlling the consumer VR space in Europe, as well as America and China.  Revealed was the ‘Pico Neo 4’ (working title), the latest in the Pico VR range of headsets but, rather than competing with the ‘Meta Quest 2’ as had the ‘Pico Neo 3’, this version has the Quest Pro squarely in its sights. For example, it uses the pancake display lens that is planned for Quest Pro and will include advanced eye-tracking – an element that now seems essential for any headset hoping to survive in the market – along with other advanced features. Pico is owned by TikTok owners ByteDance, and the implementation of social media support elements is another expected feature. It was also recently revealed that a competitor to the system, from Japanese manufacturer Sony, has plans in this direction. 

Just before Meta Connect, Sony Interactive Entertainment (SIE) revealed more details of their planned ‘Sony Playstation VR2’ launch, and shared information on the features of the new hardware to their million-unit-selling original VR headset. The PSVR2 will include a new see-through component, allowing the users to see the world around them while wearing the headset – a feature seen originally on HTC VIVE headsets and recently on the Meta Quest range. But the big news was the broadcast feature, meaning players can stream themselves in their VR experience. Social media, and influencer gaming (“Let’s Play”) are big on Youtube and TikTok, and the ability to create this content is essential. Other VR headsets have tried to offer this element as a seamless feature but have yet to see popularity. The VR market now waits for SIE to confirm the release schedule and pricing for the eagerly awaited consumer headset.  

VR Location-Based Investment

While Meta may have decided to not support their ‘Oculus Quest Arena’ concept, the free-roaming entertainment market has grown considerably in its application in location-based entertainment (LBE). There are numerous new entrants using high-end and standalone performance VR platforms, offering groups of players the ability to experience cooperative virtual adventures.

The development of venues that offer free-roaming VR experience has been seen with the abortive TheVOID concept (due to mark a return to the business under new management), as well as from Dreamscape Immersion, and from industry pioneer Zero Latency. One of those also leading the charge in this space is SandboxVR. The Hong Kong based corporation has dusted itself off from the privations of lockdown and started running again, having opened over 20 more locations to its chain, utilizing the $119m investment gathered to define the operation internationally.

This investment has also gone to updating their technology and starting to partner with franchise operators to spread the word. An example of this move towards a franchise model was seen in London, with the opening of the first Sandbox VR location in this territory. At the launch event, a central London retail unit had been developed into a four-arena virtual entertainment space, boasting full body tracking, ‘Pico Neo 3’ VR headsets and HP backpack PCs – the players also wear the latest haptic vests and weapons, for added immersion. The venue was also the first to incorporate a food and beverage component, incorporating a robotic bartender system, offering a Competitive Socializing vibe. The venue is looking not just at city workers and drop in traffic, but also establishing an offering for corporate events and private hire – building a new facet to the Sandbox VR model. 

London, and the surrounding area, have seen several new free-roaming venues open and grow their brands. MeetSpace VR recently updated their location with the latest Zero Latency content, developed in partnership with Ubisoft to offer ‘FarCry’ VR adventures based on the popular videogame IP. The DNA VR chain of three venues has also offered new free-roam experiences and is celebrating its fifth year in operation. Outside the Capital, in the city of Leicester, the new operation ROAMDOME opened, offering their own free-roaming VR experiences, using the standard TrueVRsystem technology and game experiences – already popular in Europe. 

London is due to see another new free-roaming experience opening in the Westfield Mall. Developed by Czech-based Divr Labs, the operation is rolling out a chain of VR adventure venues based on their experience in the market. Having driven sites based on their technology for operators, the company has now received investment to open their own venues called ‘Divr Labs Arena’. The first opened in the Westfield Mall of Scandinavia, Stockholm, early this year, and the London venue will be following soon – the VR arenas offer a more adventure-based experience, appealing to a wider audience.

The company has experiences such as their ‘Meet the Dinosaurs’, appealing to families of all ages, and has moved away from the restrictions of backpack PCs, achieved through streamed high-end VR experiences, with guests wearing HTC VIVE Focus 3 headsets. This adventure style approach allows the venue to offer a capacity of 48 guests per hour, with a flow model through their centralized VR space. Divr Labs have their own plans for a wide rollout of this chain internationally. 

Another European VR development also came to the UK. It was revealed that MackNeXT, the media attraction division of the venerable ride manufacturer, installed at Alton Towers in partnership with HB Leisure, their ‘YULLBE Go’ free-roaming platform. Placed in a unique temporary enclosure on the property at the Stoke-on-Trent park, guests can pay an additional fee (upcharge) to try the ‘VR Experience’. The ‘YULLBE Go’ system uses the HTC VIVE Focus 3 VR headsets and is a cost-effective version of the full ‘YULLBE Pro’ platform. Players select from eight, ten-minute adventures to explore at the theme park location. This was seen as a proof of concept for the developer and operator, to evaluate reactions to a VR experience (set to run until September). YULLBE has installed several pop-up stores across Europe, as well as even placing a temporary installation on an AIDA Cruises ship. All this while operating their permanent flagship stores at Rust, adjacent to Europa Park, and at Wunderland, Hamburg.

This is the latest attempt by Alton Tower owners, Merlin Entertainment, to deploy VR at their parks. The company was one of the first to field a VR attraction with ‘Derren Brown’s Ghost Train: Rise of The Demon’ at their Thorpe Park location, opened in 2016. The same year, there was also the short-lived deployment of VR on their ‘Galactica’ coaster at Alton Towers (along with other coasters operated by the company). Now, with this latest tech, the idea of operating a free-roaming VR attraction at a park location has been considered by other operators. MackNeXT is working with Merlin’s amusement partner HB Leisure to achieve this temporary installation, and it will be interesting to see the results of this evaluation.

The VR free-roaming market is an aspect of the immersive entertainment scene that is seeing many new entrants and considerable investment. And we expect to report on several new developers, and the technology that empowers them, in the coming months – with new launches expected at IAAPA London and Orlando.