For a brief period of time, Oculus was the standard bearer for VR, but just a couple of years into this latest (and by far most promising) wave of consumer-facing VR, the company stands at a crossroads. It’s facing market threats from all sides, and its more or less walled-garden strategy looks more tenuous than ever.
Apple Versus Google Paradigm All Over Again
In a way, it’s sort of the Apple versus Android paradigm that’s defined the smartphone market for the last decade. Apple is the only company that makes iPhones, and no non-iPhone devices run iOS or iOS apps. Google designed Android, by contrast, as an open platform. Any number of hardware makers could build phones that ran the operating system and its apps.
With few exceptions, that’s where the market stands today: Apple has found great success with its walled-garden approach to mobile, and Android runs on an astounding number of devices and has allowed the larger smartphone market to exist and grow.
Following this paradigm, Oculus is like Apple and HTC/Valve (and now, Microsoft) is like Google.
Oculus (or more accurately, Facebook) has dumped hundreds and hundreds of millions of dollars into building its platform and jumpstarting a market for experiences to run on it. But it has so far shown little interest in sharing with other companies.
By contrast, Valve’s SteamVR was conceived as more of an open platform. However, given that the only device that ran those SteamVR applications was the HTC Vive, “open” was mere lip service. The platform was essentially open but effectively closed.
Moving And Shaking
That is apparently changing, as Valve announced that it’s licensing a great deal of its VR hardware IP to third party device makers. That means that we’ll soon see high quality VR devices coming to market from a variety of vendors--and they’ll all run SteamVR, not Oculus content. (Oculus just announced that it's open sourcing the designs for its DK2 headset, but that's not at all the same thing Valve is doing, nor is it intended for the same purpose. At least not really.)
If Microsoft’s grand plan succeeds, Oculus faces an assault on a whole new front. The Windows Mixed Reality headsets are designed to compete against higher-end VR HMDs on the gaming front (although gaming isn’t necessarily the primary focus of Windows Mixed Reality), and Microsoft has a strong advantage on the operating system side. There are questions about content, but the company is planning to get all of the SteamVR content on its platform, which would solve that issue in one fell swoop. (This is not to mention all the UWP apps that can run within the WMR environment in windowed form.)
If SteamVR successfully makes it to WMR, that leaves Oculus on an island.
The Oculus Position
Oculus may not care, and it may not need to care.
In terms of hardware, especially, there’s a certain logic to keeping a tight rein on things. Again, the iPhone is a prime example: Apple controls every single aspect of the design and engineering and operating system, and iPhones sell extremely well. The market doesn’t need 50 different iPhones, and more to the point, Apple doesn’t want there to be 50 different iPhones on the market at a given time. In the same way, we don’t need more than one or two versions of the Rift muddying the waters, necessarily.
Although Oculus does not offer an operating system, it does have a platform, upon which VR experiences run. Like Apple, by controlling the app/experience ecosystem, in terms of the apps and experiences designed to run on the Rift, Oculus can ideally maintain a certain level of control—or, to put it in more PR-friendly speak, Oculus can ensure high quality.
Perception, Reality
The above may be true—that Oculus is unafraid of these moves by Valve and Microsoft and is sticking with its plans—but it feels like less of a strategy and more of a state of being.
Although Oculus was off and running first with its incredible VR demos on prototype hardware, HTC and Valve caught up fast. In fact, when the Rift and Vive officially debuted, virtually side by side, the Vive had the edge. Oculus has done an excellent job maintaining parity, though, most notably by launching its excellent Touch controllers last year at OC3 to compete with the Vive’s wands. Even so, Oculus has arguably been chasing the Vive instead of outpacing it.
Then, between Valve’s recent licensing move yesterday and Microsoft’s plans (which officially launch on October 17), Oculus needs to make a move lest it be left behind.
That move needs to be made this week at Oculus Connect 4.
What Might We See?
We’ll learn more at the OC4 keynote tomorrow (Wed, Oct 11), but for now we can only speculate: What might Oculus come up with?
The obvious answer would be a Rift 2 of some kind. Upgrades should include a higher-resolution display and inside-out tracking. A killer move would be some kind of camera passthrough option that would grant true mixed reality capabilities, like the Vrvana Totem and the (now canceled) Intel Project Alloy.
We don’t expect such an announcement, though. What’s more likely is a standalone Rift HMD. Oculus’ John Carmack has said the industry needs such a device, and last year at OC3, we saw a prototype of one called Project Santa Cruz. (If there is such a device, it will really need inside-out body-, object-, and controller tracking.)
HTC is possibly winning that race, though, announcing earlier this year that it would be building a headset based on Qualcomm’s 835 SoC. A few months later, a report emerged indicating that Oculus was also building one, although the company never confirmed or disconfirmed the report, offering only a vague statement acknowledging that it was investing in “the standalone VR category.”
HTC’s device will apparently run Daydream, not a Windows-based VR platform like SteamVR or Windows Mixed Reality, but if indeed the rumored standalone Rift will do the same (we know that it will use a Qualcomm 835 SoC, so that only makes sense), once again we’re back to parity between the two.
There is another opportunity for Oculus in the standalone space, though. We know from the HoloLens, and to a larger extent from the base specs for Windows Mixed Reality, that you can get VR (and AR) experiences onto devices that have shockingly thin PC specifications. Even so, a laptop (or even a desktop) CPU with IGP would be superior to a mobile SoC. And if Oculus is tightly controlling the hardware and software stack, developers could optimize for that particular hardware, which means it could milk more performance out of it than perhaps we’ll see from an Ultrabook running a WMR headset. Further, such a device could run Windows, and therefore the Oculus platform.
In that scenario, Oculus would have scored a huge coup by being the first to market with a true untethered, standalone VR HMD that runs (with utmost respect to Daydream) serious titles. And if it offers some mixed reality capabilities, it will be all the more compelling.
Presently, we’re at a point in the desktop VR market where the majority of the HMDs have more or less hit price and specification parity. Both Valve and Microsoft are gaining an edge by engaging other companies on hardware and software, so if Oculus is to remain in the top tier, it must either follow suit (which is unlikely given its walled garden strategy) or come out with better hardware.
We expect the latter this week at OC4.
