VR Is a Marathon Not a Sprint, Road to Adoption Will Take Years: Video
Troy Dreier: Hi everyone. This is Troy Dreier of StreamingMedia.com coming to you from Streaming Media East 2016. I'm having conversation with some of the thought leaders of the industry while were here. Joining me right now is Joel Espelien, senior analyst for The Diffusion Group, one of the principle analysts of the new video economy. Joel is here talking about VR today. He's moderating a panel on virtual reality. I'm not a believer. Can you convince me, or are you not that big on it yourself? Where do you stand?
Joel Espelien: First, thanks. Great to be with you Troy. I consider myself a VR realist. I think that a part of the industry is way too optimistic about VR right now and thinking that it's going to be massive media tomorrow. I think the other part of the industry is way too skeptical thinking it's another 3D, and it's going to die out in six months. I think neither is true. VR is real, but it's a marathon and not a sprint. It's going to take a long time to get mass adoption.
Troy Dreier: We're seeing so many content companies pouring money into VR efforts, trying to get people to use Goggle Cardboard and Oculus Rift and experience their content in virtual reality and 360. Is it going to pay off for them? Are they going to see returns on that invest?
Joel Espelien: I think there's a lot of FOMO right now. Fear of missing out on VR. I think we're in a classic trial phase. We've lived through this in the mobile industry when there was tons of trialing and piloting of mobile video before it turned into anything. This seems is deja vu all over again with VR. I don't think most of these early pilots and trials are going to produce a very high ROI, but hopefully for those that do it well it is going to product some learning that may bear some fruit down the road.
Troy Dreier: Is it just about gaming right now, or are there entertainment things that are going to pay off?
Joel Espelien: I think gaming is the market maker. Why I think that's probably going to be important is you've got to understand that the early adopter VR user is a gamer. You're talking about a young male demographic. I really puzzle when I see some of the high culture travel type VR that looks like it's targeted to an affluent baby boomer type market. To me, that's not the VR type market. I think those that have done video target that's highly target that could easily crossover into that young gamer audience is going to do a lot better.
Troy Dreier: We're seeing a lot with concerts, also, you-are-there experiences.
Joel Espelien: Another good one, right? I think it's got to be the right show. I'm not sure I would do the Rolling Stones if I was going to target VR right now because I don't think those people are going to put on a headset, but for the right acts I think music is another good crossover immersive type thing. Especially festival type stuff. Not necessarily traditional big stadium type stuff, but things that are a little more organic, I think might be interesting.
Troy Dreier: Now for the hardware, who's going to win out. I've got four Google Cardboards at home that I never even use. Are we all going to be throwing out our Cardboards in a few years and using other devices.
Joel Espelien: Fortunately those Cardboards are recyclable, Troy, so they're environmentally friendly. I compare it to I've been revisitign the early days of video consoles, which was the area that I grew up in as a kid. You've got to remember, we went through an entire generation of Atari 2600s, Intellivision, Colecovision, my personal favorite. The fact that I can pitch Colecovision on here is a boost. But all those things then died out in the '82 video game crash. Including Atari went bankrupt. Yet was the Atari 2600 successful in its day? Sure. I think that's absolutely where we're at with VR today. We're in the Atari 2600 era where things can get big without necessarily being the long-term sustainable successful.
Troy Dreier: I only threw away my Intellivison a year ago.
Joel Espelien: You threw it away?
Troy Dreier: Well someone at Salvation Army got it. Some got it and about 20 games. I hope it found a good home.
Joel Espelien: Nice.
Troy Dreier: Thank you for joining me Joel. This is Troy Dreier coming to you from Streaming Media East.
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