Virtual reality is a very niche technology right now. It is popular with gamers, as games comprise over 90% of consumer applications. Playstation VR has been successful in terms of sales and usage. And the other headsets are primarily being used for that same purpose.
Businesses have adopted virtual reality. Health care and real estate have been the first industries to see levels resembling mass adoption. But that’s about it. Sales and usage are small.
None of this is remotely surprising. Despite some saying VR has been disappointing, the metrics say otherwise. A major new technology rarely does very well in its first release. New tech usually has big prices, minimal software and use examples, and hardware constraints. But virtual reality is still primed to become the next major computing and communication platform. It has too much potential, too many applications to both consumers and businesses, and too much investment to fail. It will hit mass adoption at some point.
We predict the mass adoption timeline be approximately 5 years. And within 10 years, we predict it will start replacing a lot of our current technology devices (televisions, mobile phones, and PCs).
What do we mean by mass adoption? The first stage (5 years) simply means that the world will be regularly using virtual reality. It won’t be a population majority by that point but most consumers and businesses will have started investigating or investing in VR. It also suggests that the medium will become more profitable, widely covered in the media, and found on store shelves everywhere. Jobs will start to become plentiful in the field. And people will start to see how revolutionary the technology will be.
The second stage of mass adoption (10 years) will see a majority of people buying and using virtual reality. The timeline varies by country. Lower income and rural geographies tend to lag new technology adoption and will lag that timeline as well. We see mobile phone adoption as a good comparison point.
The question we see from businesses is when they should start investing. VR profitability is very niche right now. And because adoption is so low, it feels risky to get started. As we said, profitability should start becoming more common in about 5 years. So we think now is the right time to start investing, building capability and infrastructure, and experimenting with niche uses.
Our presentation below answers that question with a bit more depth. What needs to happen prior to virtual reality mass adoption? How will the technology change and improve from its current version? And what other events will happen prior to reaching mass adoption? We explore in detail…