VR continues to wow consumers, but few intend to buy pricey hardware

By Zhang Ye Source:Global Times Published: 2016/7/25 19:53:00

Virtual reality (VR) has been the belle of the ball at many big tech exhibitions so far this year. The event held by Alibaba Group Holding over the weekend was no exception. Attendees flocked to VR booths sponsored by tech companies including Samsung, Alibaba and HTC. After testing out a VR roller coaster at the event, one girl was so scared that she cried a bit. But despite the technology's popularity, surveys have shown that most consumers would never actually spend money on the pricey hardware. Analysts said consumers aren't exactly rushing out the door to buy VR headsets. It hasn't helped that China's VR product market remains fractured and that there are already other cutting-edge technologies on the way that could supplant VR.

A woman tries out Buy+, Alibaba's "virtual shopping experience," at a tech event in Shanghai on Friday. Photo: Zhang Ye/GT

Over the weekend, tens of thousands of young people gathered in a 30,000-square-meter pavilion within the Shanghai World Expo Exhibition and Convention Center to get a closer look at one of humanity's latest technological breakthroughs.

The three-day event, which ended Sunday, was sponsored by e-commerce giant Alibaba Group Holding, which has recently been trying to diversify into technologies such as virtual reality (VR).

Of the slew of high-tech gimzos at the event, such as drones, 3D printers and robots, VR appeared to get the most attention.

Many visitors waited more than an hour to spend about 10 minutes in Alibaba's virtual "immersive shopping experience" dubbed "Buy+."

Similar scenes played out at other booths featuring VR hardware.

Samsung Electronics' booths were nearly encircled by visitors, a Samsung employee, who asked to remain anonymous, told the Global Times on Saturday. It was enough to draw the attention of the venue's security personnel.

Worth the wait

After riding a virtual roller coaster powered by Samsung's Gear VR, Yin Xin, a 20-year-old university student in Shanghai, was eager to give it another go.

"It's so vivid. Even now I cannot believe that I experienced riding a roller coaster in the jungle while sitting in a chair inside the Shanghai exhibition center," Yin told the Global Times as she waited in line for a second try.

Also back in line, another visitor confessed that she was so scared that she cried a bit during her first time on the VR roller coaster.

Alibaba's Buy+ also wowed attendees. The VR "shopping experience" allowed users to shop for everything from bags to bras in a virtual 3D store. With a VR headset and two hand-held controllers, potential buyers could also check out product reviews from other customers. Many experts see this as a disruptive change to the world of retailing.

"Alibaba is opening up a new universe to us. It can save me the effort of walking around a brick-and-mortar shopping mall, while allowing me to pick out the products I want more efficiently," a 29-year-old white-collar worker surnamed Zhang told the Global Times on Saturday.

No need to buy

Although they were impressed with the immersive experiences of VR, neither Yin nor Zhang intended to actually buy one of the devices.

It's a common attitude about VR. A survey of Chinese Internet users found that 71.3 percent of respondents did not want to buy a VR product, according to a June 21 report by a Guangzhou-based market research firm iiMedia Research. The survey found that cost was the major issue.

HTC, a forerunner in the VR field, sells its Vive VR headset for 6,888 yuan ($1,032) in China. The price is a lot more than the $199 that is acceptable to consumers, according to a report by the San Francisco-based market intelligence firm Greenlight.

Furthermore, the high-end VR headsets such as the Vive and the Oculus Rift require some powerful computer hardware to run them. They require a personal computer with a high-graphics processor, said Hu Xiaohang, a technician with Buy+ project.

"The additional PC will raise the total cost to more than 16,000 yuan," Hu told the Global Times.

He noted that Alibaba's Buy+ project targets merchants and retailers who are better able to afford the expensive hardware.

China's fragmented VR market has also slowed down the adoption of VR technology, said She Shuanglin, a Beijing-based independent VR expert.

More than 100 low-budget brands sell about 1,000 so-called mobile VR headsets per day in Shenzhen, South China's Guangdong Province, the US-based news portal roadtovr.com reported in March.

These so-called VR devices are cheap, but their quality is uneven, experts said.

"The insufficient consumer adoption of real VR devices and lack of unified VR standard has dampened companies' interest in developing VR content or apps, causing a vicious circle," She told the Global Times on Sunday. "A heavy headset with no killer apps or content cannot survive for long."

This situation helps explain why companies like HTC and Facebook are setting up open, resource-sharing platforms to woo app developers.

Beyond VR

It may be a wise decision for consumers to be prudent about VR headsets, because several tech bigshots are betting on bleeding-edge technology that could supplant VR, She said.

While Facebook, Samsung and HTC are racing to conquer the VR world, other tech giants like Microsoft and Google, as well as some start-ups, have pinned big hopes on augmented reality (AR) and mixed reality.

After five years' development, Microsoft HoloLens, a smart-glasses headsets for AR applications, was unveiled in 2015. The US tech veteran has not set a price or release date for the consumer version yet.

Google, which already tested AR glasses in 2012, may issue headsets featuring both AR and VR, according to media reports.

Brian Wallace, CMO of Magic Leap, a US-based start-up focused on AR and MR, thinks VR is not something new.

At a press conference during Alibaba's tech event in Shanghai on Friday, Wallace said that VR headsets are so large and expensive that they "will not be adopted by many people."

Magic Leap, which is backed by Alibaba, does not aim to make digital environment that shuts out the real world, but rather layer virtual images on the top of the world, or even interacted with the real world via light and portable AR/MR devices, Wallace said.

AR appears to be more promising than VR. "The application of VR is limited to indoor gaming and films, as the heavy headsets do not allow wearers to wonder around the street," She said.

In the past, many firms have hesitated about developing AR, but with the recent success of the hit mobile game Pokemon Go, public awareness of the technology has grown - as has interest in its application.
Newspaper headline: Virtual interest

Posted in: Insight

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