cancel
Showing results for 
Search instead for 
Did you mean: 

The Oculus Summer Sale spawns a new competitive analysis

Zenbane
MVP
MVP
A great new article has been published by VRBeginnersGuide.com

Throughout the past 15 months there has been ongoing debate centered around the competition in the VR Industry. At the forefront of that debate is, of course, the quintessential: Rift vs Vive

Everyone has their opinion, bias, and speculation. The lack of "official sales" numbers also forces consumers to rely on alternative sources of information (e.g. surveys, research agencies, search engine statistics).

Yet the Oculus Summer Sale has dropped the Rift down to a price that was promised before its official release (In September of 2014, Palmer went on record for stating that the Rift should reside between $200-$400). Thanks to the lengthy Summer Sale, the competitive analysis has returned to the public eye.

I love the VRBeginnersGuide.com article because it addresses the full spectrum of the Rift/Vive debate, and paints a very clear picture of a reasonably expected outcome.


Is this the Beginning of the End for the HTC Vive?





Things were looking rather grim for Oculus at the end of 2016. SuperData Research estimated there had only been 243,000 Rift units sold verses 420,000 HTC Vive units. Even with Oculus releasing their Touch controllers near the end of the year, it seemed like much of the community had already written Oculus off. The new controllers were supposed to bring the Rift into direct competition with Vive’s Room-scale tech, but launch did not go smoothly. Full room-scale was still officially experimental and thousands of users reported glitches with the tracking.

At first glance, it may seem the Vive is going from strength to strength. Releasing some cool new trackers to bring more objects into the virtual world, and the Deluxe Head Strap. There is an eye tracking attachment in development that will allow foveated rendering and the new Knuckle controllers are set to be the new standard with full 5 finger tracking.
But, all of these new upgrades have issues.

The trackers will, at best, result in a whole bunch of new peripherals that are only suited to one or two jobs. Eye tracking is great for developers working on foveated rendering, but from a consumer stand point it probably won’t see widespread use in games until a year to two’s time. By then we will be staring down the barrel of VR generation 2. The Deluxe Head Strap will set you back at least $100USD and early adopters found the foam on the back disintegrated in contact with water. Reviews indicate that at best the comfort level only matches that of the Rift. So, that’s $100 to bring an already more expensive product up to the same comfort level as the competitor?

Finally, while the Knuckle controllers looks awesome, they are made by Valve, not HTC. Let’s talk about why this is a bad thing.

Not everyone realizes that the Vive was actually a joint venture between Valve and HTC. Valve developed Open VR and the Lighthouse tracking system, and Vive builds the hardware. So, for a start the main trump card HTC has, Lighthouse tracking, is not even their tech. The upcoming LG headset, which will shortly be followed by other major brands, will use the exact same tracking technology. The Knuckle controllers will also most likely be compatible with these new systems.

The main implication of this arrangement is that HTC only makes money from selling hardware, the Vive and it’s add-ons. Steam wanted VR to be an open platform and prevented HTC from developing exclusive software to go with the Vive. Recently HTC circumvented this agreement by opening Viveport, an exclusive software environment only accessible on the Vive, similar to OculusHome. But Viveport can only save them if they continue to dominate the market. That will be difficult for two reasons. 1: Other major brands are about to jump aboard the Steam VR train, and  2: Oculus price cuts.


Why You Won’t See a Vive Price Drop

Oculus has a different business model, the Software ecosystem. Their model is all about making money from selling software for the Rift, not selling the Rift itself. This is why Oculus was able to drop the price so drastically less than 12 months after the original release. The more Rifts in homes, the better. HTC on the other hand famously and proudly proclaimed they were selling the Vive for a profit from launch. This would explain not only why many Vive users experience broken hardware (dead pixels, broken lighthouses, shoddy controllers and disintegrating head straps), but also why HTC will never be able to price match with Oculus.


HTC has Been in Trouble for Years



This is what has happened to the HTC stock price in the past 5 years. It’s not a pretty picture. In August of 2015 their stock price was so low that the company was valued at less than the value of their actual physical Assets. A signal that investors have zero faith in the company’s long-term earnings potential, either in the form of eventually turning a profit or even getting acquired by a larger firm. The price has barely shifted since then. They recently had to sell one of their factories just to keep up funding for VR and with their latest smart phone failing to score a decent slice of the market there is little reason to believe things will get any better any time soon.


Signs of the End

We quoted SuperData’s sales estimates at the start of this article. 243,000 Rift units verses 420,000 Vive units. The more recent numbers, however, are looking quite a bit different. A June 2017 report by Research firm IDC estimates the Rift has sold about 520,000 units, compared with 770,000 of HTC’s Vive. Which this does show the Vive still in the lead. Have a think about what these new numbers mean. If both estimates are accurate, then in the past 6 months Oculus has sold 277,000 to HTC’s 350,000. Much closer numbers than last year. Also, Oculus just announced the new all-in-one Rift package will be set at a price of $499USD, close to half the price of the Vive. With both systems now performing practically the same; how do you think those numbers will look in another 12 months?

We have little doubt that VR is here to stay. The overall numbers just keep getting better and VR’s future is looking to be on very solid ground this year. But with LG, Microsoft, Apple, Acer and ASUS among others about to enter the market, the Vive’s days as Steam VR’s poster boy look well and truly numbered.


Full article:
https://www.vrbeginnersguide.com/is-this-the-beginning-of-the-end-for-the-htc-vive/

One source reporting news of HTC selling their second Factory:
https://www.androidheadlines.com/2017/03/htc-selling-another-phone-factory-fund-vr-business.html

❤️
43 REPLIES 43

vannagirl
Consultant
@Zenbane

Winner, winner, Chicken dinner
Look, man. I only need to know one thing: where they are. 

cleanupdisc
Adventurer

vannagirl said:

@Zenbane

Winner, winner, Chicken dinner


PUBG VR?

Shadowmask72
Honored Visionary
This isnt going to end well..



System Specs: MSI NVIDIA RTX 4090 , i5 13700K CPU, 32GB DDR 4 RAM, Win 11 64 Bit OS.

Anonymous
Not applicable

vannagirl said:

@Zenbane

Winner, winner, Chicken dinner


Hang on. I heard this phrase for the very first time last night whilst watching series 5 of NCIS Los Angeles. I don't have a crawl space cos I'm on the top floor but I have a flat roof...you haven't been stalking ME have you?  

Hmmmm...I'm starting to get worried now lol  😄 😄 😄

Morgrum
Expert Trustee
I predict this trend will go sideways real soon.
WAAAGH!

vannagirl
Consultant
@Shadowmask72

i know right, but normally this threads are about Oculus from certain posters so it is fair game sometimes 😉

@Cleanupdisk

PUBG VR??

Edit Player Unknown 🙂

@Snowdog

yes funny you say i heard it last night for the first time also, about 8.30pm.
Also how can a roof be flat with someone on top, that is not flat at all, silly 😘
Look, man. I only need to know one thing: where they are. 

Zenbane
MVP
MVP
I received my Oculus Rift around May of last year. Which puts me at 15 months of ongoing use (not daily but weekly at the very least).

In all that time, this is the first Article I've read that not only suggests Oculus has a strong business model that is capable of threatening its competition, but also the first Article that accurately covers all angles of the competitive analysis fairly. The fact that the writeup concludes with Oculus predicted as a winner is just the icing on the cake. Hmm, or maybe it's the cherry...

Syrellaris
Rising Star
I think it is widely agreed that keeping the Rift and Vive both at 900+ bucks wasn't going to work out that well. Vive's high development costs and simplistic errors in terms of comfort(straps, early controllers) keep the price high with little room to go lower. 

For VR to go mainstream 499 is a good price for a complete package, it is right up there with a good monitor or a new console, heck even good TV's are at that price these days. 

I think it was a good article, it will def be interesting to see who in the end will be crowned the winner. I have my faith in Oculus for that, but don't underestimate openVR from steam.

Zenbane
MVP
MVP



I think it was a good article, it will def be interesting to see who in the end will be crowned the winner. I have my faith in Oculus for that, but don't underestimate openVR from steam.


Agreed. And Oculus does have plans to join OpenVR as well:
Here, Rubin is referencing Oculus' work with the Khronos group (of OpenGL fame) on developing a common set of industry-wide VR standards. Announced back in December, the effort aims to create a set of "APIs for tracking of headsets, controllers and other objects, and for easily integrating devices into a VR runtime. This will enable applications to be portable to any VR system that conforms to the Khronos standard, significantly enhancing the end-user experience, and driving more choice of content to spur further growth in the VR market."

Oculus has joined a range of companies including Valve, Nvidia, ARM, Epic, Unity, Google, Samsung, LG, Razer, and more in signing on to support Khronos' VR standards work. Rubin says it's this kind of multi-company collaboration that interests Oculus more than previous efforts to create "open" VR standards.
Reference:
https://arstechnica.com/gaming/2017/02/oculus-affirms-its-commitment-to-open-vr-standards/

But the same issue arises that we see with the Knuckles... OpenVR involves Valve not HTC. So Valve will benefit from everyone who joins in while HTC continues to struggle from the outside. It's a very odd Partnership between Valve/HTC. Once LG hits the market I suspect they will quickly become the Rift's biggest competitor.