Intel and ARM are designing custom chips for VR devices, while programmable chips from Xilinx, Intel and memory-biased chips from Micron and Samsung are also gaining traction.
VR display technologies have improved over the years, but audio has generally been overlooked. The growing demand for untethered headsets, along with the inherent limitations of human eyes, have necessitated the synchronisation of visuals with 3D audio for a truly immersive experience. Digital signal processors (DSPs), which improve audio quality and also make devices more powerful at the edge, are becoming standard requirements in the VR market. Established players in the 3D audio business, such as Dolby Labs, Panasonic, and 3D Sound Labs, are exploring new growth opportunities.
The growing pervasiveness of AI techniques across VR applications is enhancing the intelligence of virtual characters and delivering a rich immersive environment. Google’s machine learning tools add 6DoF controller-tracking capabilities to any standalone headset, while Facebook’s DeepFocus framework uses AI to create focus effects in VR, and LG uses AI to minimise motion sickness among VR users. Chinese tech leaders Baidu and Tencent are working on integrating AI and VR into mobile solutions and video games.
Conversational platforms have been largely ignored in the VR space. Facebook introduced Oculus Voice in 2017, but the service was basic. In April 2019, Facebook announced plans for a new voice assistant on Oculus devices but did not reveal a release date. Google has yet to integrate Google Assistant into Daydream VR and Lenovo’s Mirage Solo. The lack of credible alternatives represents an opportunity for Amazon, which has incorporated Lex into its Sumerian VR/AR managed service.
Cloud technologies promise scalability to VR vendors. As VR-generated data increases in volume, cloud services will store apps, data, and memory in virtual servers and stream them on-demand. This will drive innovation in VR and service updates in an uninterrupted cycle. Low latency, frictionless cloud-native apps will improve customer satisfaction with fresh VR updates. Amazon, Microsoft, Google, and IBM are expected to benefit from the integration of cloud and VR in the coming years, as VR companies will increasingly subscribe to their cloud services.
5G promises low latency, high density, and improved reliability, all of which will benefit the VR industry. Non-VR gaming today requires a minimum latency of 50 milliseconds, while VR requires less than 20 milliseconds. Thus, 5G’s expected latency of just one millisecond should deliver exceptional experiences on VR devices. 5G’s potential to support one million devices within a single square kilometre, without the risk of streaming attenuation, would help the VR market to flourish.
Telecom companies (including AT&T, Ericsson, Verizon, China Mobile, SK Telecom, Orange, and Vodafone) could benefit from the association of 5G and VR, with their pace of penetration, tariffs, and partnerships with VR vendors determining their success.
Untethered virtual reality
While early VR headsets primarily required PC or smartphone tethering, new devices such as the Oculus Go, HTC Vive Focus, and Lenovo Mirage Solo have popularised untethered VR headsets. These devices are equipped with built-in processors, graphics processing units (GPUs), sensors, batteries, memory chips, and displays, allowing them to operate independently. The devices offer a more powerful VR experience than smartphone-based headsets, but still lag in central processing unit (CPU) and GPU power and functionality.
VR apps are proving increasingly popular. In 2019, VRChat boasted more than 10,000 daily peak concurrent users, while at the time of writing Astro Bot Rescue Mission had over 58,000 watch hours on Steam. Beat Saber became the first VR game to record sales of over a million copies, while Google Earth and BigScreen VR became popular non-game VR apps. Facebook accounts for the most premium apps on VR at the time of writing, while HTC is the only VR company with an app store subscription service. In contrast, Google has approximately 250 Daydream apps.
Material from a press release was used in this report.