Meta opens its first store as VR headsets get closer to mass reality

Many teens have virtual reality headsets, but are they starting to use them in a similar way to smartphones? So far the answer is no. A quarter (26%) of teens say they own a virtual reality headset, a higher level of ownership than a VR device, but only 5% of teens say they use technology regularly, so commitment levels remain “inconclusive”. recent research paper by Piper Sandler, “Taking a Balance with Teens: Spring 2022.”

The low use of VR headsets is due to a number of factors, ranging from the cost that is still affordable for most users, to the insufficient range of applications. The latter shouldn’t be a problem for the possible growth of the metaverse with VR, as the metaverse with acceptance could be a solution to this problem. In terms of applications, there haven’t been many, let alone those that have attracted a lot of interest.

Gaming, which has generated $200 billion in annual revenue from approximately three billion players worldwide, is a natural evolution for Gen Z and future generations, who will grow up exclusively in the digital world. That’s the goal of Meta’s big tech competitor, Microsoft, which spent nearly $70 billion to acquire Activision Blizzard. A recent study of Gen Z gamers by Razorfish and Vice Media Group found that 20% of their entertainment/entertainment budget will be spent on in-game purchases over the next five years.

But to date, there have been very few VR games (only 3% of users of the popular gaming platform Steam own a VR headset). Concert and sport also have significant potential, but there’s no real motor to either of them anymore. Even education, where immersive classroom “journeys” to anywhere in the world are part of the collective imagination of the benefits of VR, haven’t really begun. Metauniverse is certainly the biggest VR app on the horizon, so Dream Field’s approach – if you build them, they’ll come – might work.

Of course, as part of its diversification efforts, Meta Platforms, Facebook’s parent company, surpassed the ad revenue of the Facebook family of apps, including its main apps Instagram and WhatsApp, which accounted for 97.5% of last quarter’s revenue. through January 28 dollars. “Everyone’s talking about the Metaverse,” Nicolas Mendolson, Meta’s vice president of global business, told CNBC on the sidelines of the Milken Institute’s global conference last week. But the revenue contribution for the Reality Labs division, part of the company that develops products for Metaverse, was $695 million. Reality Labs continued to swallow cash when it was a big bet on the company’s future, posting a loss of $2.96 billion in the first quarter compared with a loss of $1.83 billion in Q1 2021. Executives say costs will be high. The device will be slightly lighter than expected. was foreseen and will continue to be a cost growth zone. The company has committed more than $10 billion to building the metaverse.

The cycle between the investment and “significant enough revenue growth” to become profitable will be long, according to the company. “I think it’s going to take Reality Labs a lot longer than a lot of the traditional software programs we build,” Meta chief executive Mark Zuckerberg said during a recent earnings call. “We are investing heavily to deliver the next platform, which I believe will be critical to our mission and business, and whose value will be comparable to today’s leading mobile platforms. Now I understand that this build is expensive. It was something that had never been built before.”

Against the backdrop of high costs, some experts believe that a major breakthrough is possible. There have been significant innovations in VR, says Sarah Ostadabas, assistant professor of electrical and computer engineering at Northeastern University, to the point that she believes widespread adoption could really be “just one or two killer apps.”

“With its high latency and poor head tracking, previous VR was basically useless,” he said, adding that Oculus “had overcome those key limiting factors.” On Monday, Meta opened its first physical VR headset technology store and showroom where customers can buy Quest 2 headphones, and is also gearing up for its high-end headphones, currently called Project Cambria and launching later this year, set to hit the market.

It’s fair to say that with these technological advances, there’s room for growth on the design side, an area that Apple has typically had (has long been rumored to be making headphones). “Apple has been rumored for years to be releasing industry-destroying AR/VR hardware,” said David Lassala, team leader, interactive development and XR technology at New York University. But he said that among the current active players, the clear leader is Meta (formerly Oculus) Quest 2. The second is probably Valve Index. Other notable headphones include the Lynx and Pico Neo. Also worth mentioning: Pimax, Varjo, HTC Vive and still some Windows Mixed Reality activity.

However, since Meta isn’t a hardware company by nature, there’s a lot of leeway in the niche to allow for the best use of VR development. “I think they want to build a platform (OS),” said Ostadabas. “Google got scared when Meta and other social networks banned them, so they jumped on mobile to avoid losing this important source of information. Similarly, Meta finds it difficult to do what smartphone vendors can to undermine their business models with policy changes. Recent privacy restrictions on ad targeting from Apple and Google’s smartphone operating systems cost Meta billions in ad revenue. The company’s chief financial officer estimates that the changes could cost Apple $10 billion in revenue this year. There are cautionary tales about owning hardware like Google Glass, which has so far found only limited enterprise and industrial applications, and 3-D TVs.

Zuckerberg said during a recent conference call that “the best experiences will be on virtual and augmented reality platforms and especially our platforms like Quest,” but he added that the company plans to make it easier for people to get involved with signing up for the multi-platform Metaverse and “without even needing headphones.” Whoever wins the hardware battle, if the technology works for consumers, what will the people in the metaverse actually do, and what’s the point of it all? Skeptics see ads and rebranding and not much else. Most noise can be interrupted by one word: presence. “Besides immersion, one of the most interesting differences between the metaverse and the internet is presence – your avatar,” says Ostadabas.

While sitting in a gathering of Purple Octopuses may seem silly (because it is), there is something to be said for the basic concept. “The internet is a source of information and people research vast amounts of information without leaving a trace. Until you comment, you are invisible. With Metaverse, your avatar means consumption requires presence, so research is active and interactive,” he says. With Presence comes another Meta promise (downloaded from their days on Facebook): community, a word whose meaning is vastly underestimated by social media, but which holds promise here in the metaverse as a community with no boundaries to the true geography of the world. Most lifelong community formations are tied, for the most part, to a fairly tenuous set of possibilities (school on one side of the thirties, work on the other). “At best, one finds a way to replicate that community experience in the metaverse, and people’s lives are enhanced through a greater sense of belonging,” says Ostadabas. At the heart of the Meta approach is a social platform called Horizon Worlds, and he says his next focus is on community growth once the experience is built.

At best, according to Lassala, it will allow people to find themselves deeper than ever – to grow and heal, create art and learn. Bigger claims can be made, though they remain questionable. “I think if half the world’s population met and worked in VR as opposed to traveling, it could slow down the climate crisis,” he said. “But I haven’t delved deep into the carbon footprint of server farms and the silicon versus vehicle industry, so that can only be wishful thinking.” The worst case is easier to determine. Meta believes that today’s business model is a bridge to tomorrow’s business model. “This is a new paradigm for computing and social connection,” Zuckerberg said on a recent Wall Street earnings conference call. “Therefore, our financial goal is to generate sufficient operating income growth from the application family over the next few years to fund the growth of our Reality Labs investment while increasing our overall profitability.”

But the metauniverse may just be “cynical greed used to observe people on a deeper level, with AR headphones allowing you to create immersive social graphs and record interactions in a way that wasn’t possible before.” said Ostadabas. Algorithms spin around and create increasingly controversial stratifications of people to drive clicks and ad revenue, and if that’s a business model that sounds familiar, it should be. It’s the internet of Facebook and Alphabet, except this time you’re the purple octopus on Oculus. Indeed, as Horizon spreads across platforms, the deal will involve several shorter cycles that “may be a bit more in line with what we expect from the app,” Zuckerberg told Wall Street analysts.

The company recently received backlash from content creators about its plans to charge high fees for virtual asset transactions. Mendelssohn emphasized that the company’s history was marked by successful transitions. “I have worked at this company for almost nine years. We’ve made some really strong changes before that,” he said, referring to the move from computers to mobile devices and the move to Instagram Stories. The full version of Metaverse, he says, had “a few years of silence,” but he adds that it’s a continuum from where the company is today, with customers like Wendy’s already using videos and ads, and Horizon Worlds with Virtual starting restaurants last month. “This sets the stage for what I hope to be a very exciting 2030,” Zuckerberg said.