Tech Talk: China Will Likely Drive VR's Next Adoption Wave

It's been a few years since virtual reality (VR) returned to the media spotlight following its unsuccessful stint in the '90s. Since then, Oculus launched the prototype of its Rift headset after a widely successful Kickstarter campaign and followed up on that release with a fully-fledged commercial product, HTC and Valve developed and debuted the Vive, Sony introduced the PlayStation VR, and other tech giants like Samsung and Google opted to release less pricey solutions in the form of Google Cardboard, Gear VR, and the Daydream View. While VR is still far from mainstream adoption, the industry as a whole is seemingly a lot more stable than it was circa 2012 when then little-known Oculus launched a crowdfunding campaign and claimed that the future of entertainment lies in head-mounted displays. Given that state of affairs, it's hard not to wonder what's next for the VR industry and whether its latest attempt at attracting a mass audience will finally succeed. According to some industry watchers - it will, and China will play an important role in that rise to stardom.

According to last year's reports that were recently picked up by Forbes, there's currently over 200 startups in China that are developing VR products and services, and most of them are aimed at delivering relatively affordable solutions that offer good value for money. Seeing how Google Cardboard — the very definition of an entry-level VR product — accounted for approximately 96 percent of shipments of head-mounted VR displays in 2016 and that dominance of affordable VR solutions is likely to continue in the future to some degree, China has a realistic chance of becoming one of the main growth engines of the VR industry in the coming years. Entry-level head-mounted displays manufactured in China like the Ritech are currently selling approximately 100,000 units on a monthly basis, and major tech giants in the Far Eastern country including Huawei, Xiaomi, LeEco, Taobao, ZTE, and Baofeng are all committing significant resources to expanding their VR portfolios in an effort to both grow and diversify their revenue streams.

While VR headsets made by Chinese consumer electronics manufacturers vary in terms of design and features, they're all available in the same price range that tops at around $40, which makes them highly accessible to consumers that are intrigued by VR solutions, but not to a point that they're willing to invest into high-end products like the Vive and Rift. If Google Cardboard's 2016 performance is any indication, this particular type of users composes the vast majority of people that are currently willing to spend any money on VR, which implies that the fastest way to bring this emerging technology to more users is through affordable head-mounted displays, precisely the ones that numerous Chinese consumer electronics manufacturers are currently developing en masse.

Naturally, Chinese original equipment manufacturers (OEMs) aren't the only ones who are delivering relatively affordable VR solutions to consumers, as both Google and Samsung are currently doing the same, and some other players are also looking to enter this field like Intel is with its upcoming Project Alloy. The high-end segment of the market that includes products like the Vive and Rift is still far from mainstream adoption, but the companies backing it are looking to change that through massive investments. HTC is trying to get more consumers to try its first virtual reality headset by financing VR arcades and funding independent studios looking to develop immersive content, while Facebook is backing developers willing to make Rift exclusives and is also trying to offer a mid-range VR solution that would act as a balance between phone-reliant headsets like the Daydream View and top-of-the-end head-mounted displays like the Vive, thus seeking to create a market of its own.

Everyone from Chinese OEMs and Google to Samsung, Facebook, and HTC is hoping that the future VR market will be able to sustain their products and services, and all of them are likely right if the technology they're investing in manages to capture a wider audience in the coming years. However, consumer electronics manufacturers themselves are responsible for advancing that technology to the point where it's able to do so seeing how existing VR solutions are still somewhat underwhelming in terms of execution, not to mention the actual content they're offering. While major VR investors like Facebook and HTC have been committing significant resources to financing third-party studios interested in developing content for their platforms, every VR system that's currently available on the market still lacks a true system-seller that would help promote it.

Overall, the VR market as a whole is noticeably growing, but the enthusiasm for this emerging technology still doesn't seem to have a solid backing in terms of actual hardware and software that's on offer regardless of the price range. Due to that state of affairs, entry-level solutions powered by smartphones such as the ones developed by Google, Samsung, and Chinese companies will likely continue fueling the growth of this market in the future, but only time will tell whether high-end products will be able to take over the reigns once the time comes when consumers are looking for something more than a head-mounted smartphone holder and when VR entertainment won't be just a curiosity, but a necessity like TVs, computers, and handsets are today; provided that ever happens.

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About the Author

Dominik Bosnjak

Senior Writer
Dominik started at AndroidHeadlines in 2016. He’s approaching his first full decade in the media industry, with his background being primarily in technology, gaming, and entertainment. These days, his focus is more on the political side of the tech game, as well as data privacy issues, with him looking at both of those through the prism of Android. Contact him at [email protected]