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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

Syrellaris
Rising Star

snowdog said:

The problem that HTC have with these accessories is the same problem they have with their headset - price. We're talking $99 for the Deluxe Strap, $200+ for wireless and $200+ for foveated rendering plus AT LEAST $99 for the Knuckles controllers. That's more than $600 for accessories, $200 of which will give you a Rift-like experience. So a Vive owner will be spending a grand on a Rift-like experience rather than selling their Vive and getting a Rift instead.

There can't be THAT many people either that rich or that stupid, surely..? 😮


Rich.. probably not... Stupid however..More then you think.

elboffor
Consultant
Cmon where is @Atmos73?
All these HTC naysayers should be told some vivarian truths...
This is my forum signature.
There are many others like it, but this is mine.

edmg
Trustee



snowdog said:

The problem that HTC have with these accessories is the same problem they have with their headset - price. We're talking $99 for the Deluxe Strap, $200+ for wireless and $200+ for foveated rendering plus AT LEAST $99 for the Knuckles controllers. That's more than $600 for accessories, $200 of which will give you a Rift-like experience. So a Vive owner will be spending a grand on a Rift-like experience rather than selling their Vive and getting a Rift instead.

There can't be THAT many people either that rich or that stupid, surely..? 😮


Rich.. probably not... Stupid however..More then you think.


It's not stupid. More like hackers who want to try out the new tech first, and enterprise customers who want to make use of it in their own software.

The former is a limited market. The latter is an area where HTC don't really have much competition, but soon will.

Zenbane
MVP
MVP

elboffor said:

All these HTC naysayers should be told some vivarian truths...


The best course of action at this point (assuming they want to be taken serious), is for a Vivarian to jump on the LG bandwagon.

LG can run circles around HTC all day long when it comes to successfully selling hardware. LG makes huge profits on their hardware, and they span a vast market:
  • TV/Audio/Video
  • Appliances
  • Mobile
  • Computers
Even I own a nice Smart Washer/Dryer set from LG 😄

Here are my own personal predictions regarding how AR/VR will look over the next 3-4 years:
  • Facebook will bring Oculus forth as the number 1 VR HMD provider for both hardware & software
  • Facebook will take the lead with Mobile AR
  • Samsung will take the lead, independently, with Mobile VR
  • Google Daydream will be the Google+ of the VR industry
  • Microsoft will infiltrate the Corporate Enterprise market with AR/VR business applications
  • PlayStation and Microsoft will continue their feud with console-based VR
  • LG will surpass HTC as the top competitor against the Rift.
  • All other manufacturers will saturate the AR/VR market, causing industry growth
  • Startups for AR/VR in both entertainment and professional industries will flourish
I already have my plans to take advantage of the money being thrown around in that last bullet point there. Arguing on the Interwebs is fun, but making money is funner. I strongly recommend that everyone stand by their convictions, learn some skills, and get paid to play in the new AR/VR world 🙂

Shadowmask72
Honored Visionary
AR and VR are on a downturn as most investments are now shifting towards AI development. Starting with China. America will follow suit eventually despite reducing investment under Chump.

https://www.nytimes.com/2017/07/20/business/china-artificial-intelligence.html

/s



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

Anonymous
Not applicable
What these governments REALLY need to do is make an AI construct based on my brain. My brain box is far superior to ANYTHING else that's around there whether the competition is AI or human. Cos I'm THAT bloomin clever. B)

And that means that after I die there'll still be a version of Harv out there that will be able to stalk and pester @vannagirl 😄

The only main problem is that basing an AI construct on my brain is a surefire way of creating Skynet and ending the human race as we know it. 😮

Techy111
MVP
MVP

snowdog said:

What these governments REALLY need to do is make an AI construct based on my brain. My brain box is far superior to ANYTHING else that's around there whether the competition is AI or human. Cos I'm THAT bloomin clever. B)

And that means that after I die there'll still be a version of Harv out there that will be able to stalk and pester @vannagirl 😄

The only main problem is that basing an AI construct on my brain is a surefire way of creating Skynet and ending the human race as we know it. 😮


Yeah I've seen that episode of Futurama  😄
A PC with lots of gadgets inside and a thing to see in 3D that you put on your head.

Anonymous
Not applicable
This article popped up on my Google Now entries a minute ago.  It got me to thinking.  One interesting thing I've experienced over the last few months is a decline in interest in regular PC games.  I bought games in the recent Steam sale but I find I have no real interest in playing them.  All my gaming time is spent between PC VR and my Switch (for my flatscreen fix on the move).  If this is common it points to a future where PC VR is the PC gaming market.  If so then you can see why Valve are so keen to get Steam as the dominant PC VR market place (and those who moan about the Oculus walled garden approach completely fail to see that Valve are doing precisely the same thing with Steam).  If Vive does fail, and/or the SteamVR market gets fragmented with LG headsets, HTC headsets, trackers etc, then there is a very real risk that forward wind 5-10 years Steam will be a shadow of its current self.  Interesting times with some long term actions being brought into play by all sides.

elboffor
Consultant
Google or facebook = skynet.
The only real questiom is which!
This is my forum signature.
There are many others like it, but this is mine.

Anonymous
Not applicable
Valve don't have to worry about fragmenting the SteamVR market because they're currently the only Store out of the two that caters to all HMDs. This is why (if rumours and Palmer Luckey on Reddit ages ago are to be believed) Valve aren't giving Oculus permission to extend the OculusSDK to cover the Vive headset. And it wouldn't surprise me if both HTC and LG have something in their Lighthouse technology licencing agreement that stops them from giving permission to Oculus too.

It's pretty pointless though tbh because OpenXR when it's ready will do this anyway. We'll have games developed using the OpenXR SDK that can run natively on any headset that's had their manufacturers signed up. Valve didn't want this to happen (Vive headsets running natively in Oculus Home) because they didn't want to stop being the only Store catering to all headsets and lose their grip on software sales but it's happening anyway in the not-too-distant future. They've just been delaying the inevitable.

I'm just hoping that the Khronos Group have some sort of standards that manufacturers must adhere to otherwise we'll end up with a flood of crappy cheapo knock-off Chinese HMDs damaging VR, something that Oculus have been against right from the beginning.