Oculus is losing the VR war – bleak outlook ahead

Chris Scott Barr - Jul 10, 2016, 8:00 am CDT
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Oculus is losing the VR war – bleak outlook ahead

VR is one of those technologies that we’ve dreamed of for decades, but has only just become a reality. Sure, we had the Virtual Boy back in the 90’s, and a handful of other “virtual reality” games over the years. However, there is really one company that’s responsible for the current state of virtual reality. Yet somehow their grip on VR dominance is slipping.

Back in 2012, a Kickstarter campaign was started for a VR headset, which was the first of its kind. The Oculus Rift quickly became a hit among enthusiasts, as it provided an immersive experience that we’d never really seen before. By strapping the unit on, you could move your head and look around an environment without relying on any external controls to move the image.

With the huge success of the Kickstarter campaign, the company produced their DK1 headsets, which were sent to the original backers. The headset was so successful that Facebook ended up purchasing Oculus back in 2014 for a whopping $2 billion. With that kind of backing, they were able to further their development, leading up to the official consumer headset being released earlier this year.

With a revolutionary idea and a ton of money, Oculus was destined to be the king of VR. So why are so many consumers turning their backs on the company that really started this entire VR revolution? To figure that out, let’s take a look at the current market.

There are really two main competitors in the mainstream VR headset space right now. There are plenty of smaller headsets that use your phone to power the experience, but these are in a completely different class. If you’re wanting the full VR experience, you have the choice between the Oculus Rift and the HTC Vive. Later this year, you will also have the choice of a PlayStation VR headset. But since it is not yet on the market, I’m really only going to talk about the Rift and the Vive.

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Both headsets were released earlier this year, and those with pre-orders had to wait a fair bit of time in order to get theirs. Currently, there is still a bit of a wait for a Rift (estimated ship date is sometime in August, if you purchase today), while those wanting to purchase a Vive can get theirs in just a few days. Despite the fulfillment issues, there are plenty of each in the wild, and being used regularly by consumers.

As far as the hardware is concerned, both are relatively similar in what they deliver to the end-user. I’ve used retail versions of both headsets, and aside from a few minor differences, they both provide a good experience. The biggest difference between them, hardware-wise, is the fact that the Vive ships with motion controllers, while the Rift’s own Touch controllers are still strangely absent.

Pricing is even comparable, when you account for the motion controllers that the Vive provides out of the box. The Rift is the cheaper option at $599, but only includes an Xbox One controller. The Vive will set you back $799, but gives you two motion controllers. We’re still not sure how much Oculus will charge for theirs, so it’s hard to compare exact prices, but the end result is likely going to be in the same ballpark.

So the headsets themselves are pretty similar, and pricing isn’t too far off. So you’d think that consumers would be pretty split on their loyalty. Everyone expected the same sort of split lines that we’ve seen over the years with Sony and Microsoft with their respective consoles. Yet that doesn’t seem to be the case.

While neither company has released any statistics or sales figures, we can use Steam to help figure out the adoption rate of both, to some degree. If we look at the most recent Steam Hardware Survey, we can see that owners of the HTC Vive make up 0.15% of the Steam user base. While that makes up only a tiny fraction of Steam users, the Oculus Rift only makes up 0.06%. So despite having considerably longer to work on their product, and a lower entry price, there are more than twice the number of Vive’s being used. Sure, it’s possible that there are a few Rift owners that don’t use Steam, but most PC gamers have a Steam account, so the Steam Hardware Survey is a pretty good indication of installed devices.

So where has Oculus gone wrong?

There are a few major areas where Oculus has let down their loyal fans. One of the biggest is the fact that despite being the first on the market, they still haven’t been able to keep up on production. Loyal fans that pre-ordered headsets were extremely disappointed to find that they would have to wait months to get theirs. What’s worse, there were numerous cases where people had to wait considerably longer than the estimated date to receive theirs. But having to wait a bit of extra time doesn’t always deter fans, and the orders kept rolling in.

Another big failure on Oculus’s part is the fact that they chose to only include an Xbox controller with their headset. Nearly every great experience I’ve had with a VR has been with one or more motion controllers. Even when I’ve had games shown to me by Oculus, they often used the Touch controllers to give me the “full experience.” When I try to play a game in VR with an Xbox controller, much of the immersion is lost, and I simply don’t enjoy myself nearly as much as I do when using motion controls.

Consumers have overlooked this omission, because Oculus has shown that they do have their own motion controllers (which I’ve used, and I like very much) and will be offering them at a later date. However, it has now been more than three months since the Rift was officially launched, and we have no idea when Oculus plans on releasing the Touch controllers, or even how much we’ll be expected to pay for them. And judging from how poorly they have kept up with demand for the headsets, it’s likely to be quite some time before we actually get them in our hands.

The worst part about the lack of motion controls isn’t that we don’t have them yet. It’s that they’re such an integral part of the experience, and we don’t know anything about them. We don’t know when we’re going to get them, and we don’t know how much they will cost. Consumers are just expected to purchase the headset without this information, and hope for the best.

Another failure on the part of Oculus was the decision to not provide room scale tracking. With the Vive, you can setup a 15’x15′ space and walk around in both your physical and virtual space at the same time. This adds considerably to the immersion factor, especially when combined with motion controls.

Now you might say that this wasn’t a failure on the part of Oculus, and that it was intentional. You’re actually partially correct. This was a conscious decision on the part of Oculus. The company has gone on record saying that they could support full room scale, but they don’t think that enough people want it, or even have the room. It’s something that they’ll work on later, perhaps around the time they decide to formally announce their Touch controllers.

Don’t get me wrong, the Oculus Rift does a great job of tracking in its limited space, and this does make it a bit easier to setup. However, to dismiss a huge feature like this is almost insulting to your customers. Just as with their decision to hold back the Touch controllers, and their fulfillment issues, consumers are left with the impression that “you’ll get what you get, and you’ll get more when we give it to you.”

I’ve outlined three major failures for the Oculus Rift, but all of these can be solved with patience. Orders will eventually be filled, Touch controllers will be released, and we’ll probably get room scale tracking one of these days. So while plenty of customers are upset, these issues will be resolved. However, there’s one major issue that has many people giving up on the company and heading to the competition for their VR needs.

PC gaming has always been different than console gaming. From being able to make adjustments to the game’s graphics, to all of the different methods for input, PC gamers are used to making their gaming experience the best that it can be. What they’re not used to is getting locked out of games simply because they own the wrong piece of PC hardware. Aside from simply having outdated/underpowered hardware, your Windows PC is going to run any game that you purchase for it. Buying the wrong brand of GPU or RAM isn’t going to prevent you from playing certain titles.

When Oculus announced that they would have their own store for purchasing games, people wondered if the company would tie their games to the Rift headset. Company founder Luckey Palmer reassured consumers that this would not be the case. Here’s what he said in a Reddit post concerning the matter:

“If customers buy a game from us, I don’t care if they mod it to run on whatever they want. As I have said a million times (and counter to the current circlejerk), our goal is not to profit by locking people to only our hardware – if it was, why in the world would we be supporting GearVR and talking with other headset makers? The software we create through Oculus Studios (using a mix of internal and external developers) are exclusive to the Oculus platform, not the Rift itself.”

This sounds pretty cut-and-dry, right? Well, around a month ago, Oculus released an update for their store, which added some new DRM. This DRM specifically checked to see if there was an Oculus Rift attached to the PC. If there was no Rift detected, the games would simply not run. This is the exact opposite of what the founder of the company said would be the case.

Yes, Facebook now owns the company, and they likely call these kinds of shots. But that doesn’t take away from the fact that consumers were completely mislead. Sure, you wouldn’t think that imposing this sort of DRM would bother Rift owners. After all, they’ve got the headset, so why should they care if other people can’t play games purchased from the Oculus store.

What companies like Facebook don’t understand is that DRM is the bane of PC gaming, and nearly every PC gamer knows that. Many of us have dealt with terrible DRM that locks us out of games because we’ve installed it too many times, or because of some other arbitrary reason. So when a company announces that they’re hardware-locking all of their exclusive titles on a PC, the entire community gets upset.

These days, PC gamers don’t really worry too much about DRM. Services like Steam usually have the only DRM that we deal with, and it’s so unobtrusive that most people forget that it’s there. Valve has turned DRM from an annoyance to a feature, by making it as easy as possible to access and play your games, no matter where you are, or what hardware you’re using.

Even Microsoft is trying to break down the barrier between console and PC, by allowing customers to get copies of games on both the Xbox One and PC, without needing to purchase it twice. The entire gaming industry is slowly moving to a place where we’re not limited by the hardware that we use. Consoles will always have exclusives, and we’re okay with that. However, PC games should not be exclusive to one piece of hardware. And any company that tries to lock games down to their on piece of PC hardware is going to face a major backlash from consumers. And that’s exactly what’s happened with Oculus.

Recently, the company did change direction and decide that they would stop locking their games down in such a way that only allowed Rift owners to play them. While this is a welcome change, it took more than a month of complaints and outrage by the VR community as a whole to get them to change their stance – one that they had already promised they wouldn’t take.

So while Oculus is trying to get back into the good graces of the community, they’ve already shown that they’re not able to be trusted, and breaking that trust will no doubt have a lasting effect. Gamers tend to have a good memory when it comes to bad DRM, and companies going back on their word, and they’re unlikely to forget the time that Oculus went back on theirs.


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