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Another perspective of VR growth.

nightauditor198
Level 5
Hey guys,

I kept thinking last night about the thread by VrMatthew about the potential growth of the VR market. It is a very interesting question, and I felt that there might be another way of getting some numbers.

For that I have not looked in the hazy future but looked in the past at other gaming systems that were revolutionary in their time.

I started in the 80ies, with the Amiga 500.

I found a pretty good statistic, which I´ll copy here:

Sales 1985: 100K units
Sales 1986: 200K units
Sales 1987: 300K units
Sales 1988: 400K units
Sales 1989: 600K units
Sales 1990: 750K units
Sales 1991: 1.035 million units
Sales 1992: 390K units
Sales 1993: 155K units
Sales 1994: 50K

TOTAL SOLD = 3980K (3,980,000 million units).

Then I picked the GameBoy as the next mark, which was released in 1989.

In the first year it sold 1 million units, which climbed to 3.2 million in 1990 and 4.4 million in 1991. Sales figures kept climbing from there.

We can already see a general increase in volume as well, as the GameBoy attracted a bigger and younger audience than the Amiga.

But now, let´s jump ahead a bit and let us look at the PS2. For the reason that I think it compares a bit better to VR in relative numbers. People knew it was coming, they were looking forward to it. It wasn´t a "surprise" like the Amiga or GameBoy.

Now, here it is where things get interesting, and where we start to deviate hard from the rather conservative figures in the other thread.

The PS2 sold 500K units... on the FIRST DAY, which happened in November of 2000. Just let that sink in for a little.

The gaming market as a whole had grown so much, that those numbers were possible. The PS2 wasn´t just bought by kids (gameboy) or adults (amiga), everyone wanted one.

By March 2001 they managed to sell a total of 10.61 million units.

In the year following that, they sold a further 18.07 million and in the year after that they sold 22.52 million units, which was the top selling year with almost 2 million units sold per month.

Sales figures slowly climbed down afterwards until they bottomed at about 6 million sold in 2011.

Let´s jump ahead another step and look at the playstation 4. Another gaming tech that was highly anticipated and appealled to a wide audience, although we still are not approaching the 50+ generation with this product unlike the iPad.

The PS4 was launched in November of 2013. In August 2013 Sony announced over a million pre-orders for the PS4.

Additionally in the first 24 hours they sold over 1 million units in north america alone. And it continued to sell a total of 22.3 million units globally as of March 31st this year.

This would amount to roughly 1.5 million units per month.

And now lastly, let us look at the iPad. This technology is kind of unique in IT because it actually sells to almost all age groups. Even more so than VR will in the beginning, but I think this should give us some idea how a groundbreaking product that all ages would buy will do in the market.

The iPad was announced in Januar of 2010 (amazing that it´s "just" been 5 years, right?). At this point there had been rumors already that were fueled by the success of the iPhone.

It started to sell in March of 2010 and managed to sell 1 million units until May 2010, which is relatively conservative. But the fun has just started. At this point we are still selling to early adopters, the 40+ generation still has to discover the product for themselves.

Sales started to pick up in 2010, reaching 4.19 million units sold for the last quarter in 2010, which equates to roughly 1.3 million units sold per month. Until March 2011 when the iPad 2 was released, they managed to sell a total of 15 million iPad 1.

That managed to further increase sales to over 11 million units for the last quarter in 2011. In total they roughly sold 33 million iPads in 2011, roughly 2.9 million units per month. At this point the market was ready for it, all age groups were getting involved, things are starting to pick up even more speed.

Sales started to grow further and reached their peak so far in Q1 of 2014 when they managed to sell over 26 million units in a 3 month period.

Now, what do all those figures and examples mean for VR?

Here are my predictions:

Over 1 million pre-orders for VR in general until the end of 2015.

IF Vive starts to sell in November 2015, then they will have sold 2.5 million units or more until the end of 2015.

That might sound too high for some, but it is actually the conservative number. PS4 manged to sell 4.1 million units for last years christmas season.

Total VR units sold in 2016 alone: over 25 million units, with a further growth in 2017 when 2nd gen hardware hits the stores.

So here we go, there is my prediction. High-end VR (PC) and semi-high-end VR (consoles, morpheus etc.) will take off like a rocket.

As soon as "real" VR launches, noone will buy MobileVr anymore. There is only one hope I see for that, and that is that mobile datatransfer gets quick enough so you can compute in the cloud and just stream the results to the phone hmd. But I don´t see that happening in 2016.

I have read a prediction that GearVr will outsell the oculus cv1 by 20 % a month in 2016. I honestly cannot see that happening.
14 REPLIES 14

Ashles
Level 4
I would suggest there is one main caveat to the comparison with those figures - all the devices you list were standalone devices.
The CV1 and Vive will not be and are dependent on the buyer already having a PC of a certain spec, or being prepared to buy one in addition which I believe will cause the sales to be lower than those projections.

I sometimes think many people on these forums are so tech-savvy that they forget there are milions of people of all ages (myself included) who will choose (for example) console games because I know they will work exactly as intended without having to be set up/buy a particular graphics card/carry out any other set up.
To really hit the high sales figures, the Vive and CV1 have to be as easy to use on a wide range of currently owned systems as possible.

And I believe it also has to be taken into account that many people are using a desktop PC less and less these days, moving to laptops, tablets and mobile devices.
Mobile will not give the best VR experience, but if it gives the most approachable and casual then this may give it the edge.

Vive and Oculus are introducing amazing desktop based systems for home VR at exactly the time when desktop PC sales are beginning to decrease. (That said, I think they will still sell loads)
"Into every life a little fantasy must fall..."

nightauditor198
Level 5
"Ashles" wrote:
I would suggest there is one main caveat to the comparison with those figures - all the devices you list were standalone devices.
The CV1 and Vive will not be and are dependent on the buyer already having a PC of a certain spec, or being prepared to buy one in addition which I believe will cause the sales to be lower than those projections.



Well, you are obviously correct, but it still has no influence on the numbers. That is like saying that BMW is only targeting people with drivers license and therefore can´t be compared to a bike.

As of 2014 there were way over 3 Billion with a "B" internet users. Even if we assume that a third of those was already surfing on mobile and pads, that still leaves a market size of over 2 billion pc users.

In any case, this is not about hitting the numbers on the head anyway. This is about demonstrating that VR in general might be a lot bigger than previously thought.

Ashles
Level 4
"nightauditor1981" wrote:
Well, you are obviously correct, but it still has no influence on the numbers. That is like saying that BMW is only targeting people with drivers license and therefore can´t be compared to a bike.

That analogy doesn't work. It's more like saying you're selling a product that can only work on supercars with engines over a certain level of horsepower, or only on cars built after 2012... It's a sliding scale and below a certain point there's just no popint someone buying a VR headset as they wont be able to use it.
People with underpowered PCs or people who have little knowledge of PCs other than to turn them on and use office are not likely to buy a VR headset. Most people who own a desktop PC in the world probably don't use it for gaming at all.

As of 2014 there were way over 3 Billion with a "B" internet users. Even if we assume that a third of those was already surfing on mobile and pads, that still leaves a market size of over 2 billion pc users.

This is the problem I was talking about. Do you really believe there are 2 billion people out there with PCs that can run the Vive or CV1? Because that simply isnt the case.
And why would you assume only a third of those surfing were tablet/mobile?
More than half of all internet traffic is mobile
(another more recent article)

In any case, this is not about hitting the numbers on the head anyway. This is about demonstrating that VR in general might be a lot bigger than previously thought.

And in terms of projections I think desktop VR will be successful but not more than current estimates. The technical restrictions are a relevant limiter.
"Into every life a little fantasy must fall..."

nightauditor198
Level 5
I don´t really know what you are arguing about? If you think those numbers are too high or low WITH the total number of PC users in mind that can run the tech then just say that.

Fact is, there are plenty of pc users today who have the hardware already in their living rooms to run consumer VR.

The points you mentioned are correct, but they only influence the total market size.

And no matter how small or challenged you think that market is, there still will be sales.

So, let´s talk numbers. If you think those projections are wrong, what do you think is more realistic?

PS: If the current estimates you mention refer to the estimated 100K sales a month, then I really think that is way off the mark. Or in stronger words: 100K sales a month would mean failure. And I don´t think VR will fail

PPS: Mobile users CAN be PC users as well. I personally own a smartphone, an iPad and a PC. Half the traffic on mobile, doesn´t mean that half the users don´t own a PC.

PPPS: Your initial point that consoles are standalone tech is wrong as well. I don´t know about you, but I tend to use my consoles with flatscreen TV´s. And they are required tech for consoles that sit in the exact same price range as PC´s do. And that does not count peripherals like extra controllers, wheels etc.

nightauditor198
Level 5
Here is a link that is thinking a long the same lines: http://www.kzero.co.uk/blog/consumer-vi ... 13bn-2018/

The speak of projected 5.7 million units sold in 2015 (more than double of what I thought) and about 11 million units sold in 2016 (less than half of what I thought). They do see almost 24 million units sold per year in 2018.

That is a bit less optimistic than I probably am, but it goes in the same direction.

Here is a another chart from business insider: http://uk.businessinsider.com/chart-of- ... 015-3?r=US

They see VR sales in 2018 at 10 million units, which could be seen as the pessimistic perspective.

Here is another link: http://www.kzero.co.uk/blog/vr-headset- ... 2014-2018/

They go into it in detail, I really recommend to read through this.

They project about 15 million hmd sold in 2016 and 26.5 million units sold in 2017. They are a bit closer to my numbers. They also see 2.7 million sales for 2015 btw.

I personally believe that VR in general is still underestimated by a lot of people, because it is one of those techs that you have to try to fully grasp the potential and importance of it.

You cannot explain the concept of dreadhalls in words. People have to try it and feel themselves how it is. The true potential of VR will be revealed when the first consumer devices get finally into our hands and all the social media will be flooded by hype and user reviews.

That is why I believe that VR tech will sell so well. But I guess we will all find out over the course of the year 🙂

pedrw
Level 5
Virtual
"nightauditor1981" wrote:
Over 1 million pre-orders for VR in general until the end of 2015.
Total VR units sold in 2016 alone: over 25 million units, with a further growth in 2017 when 2nd gen hardware hits the stores.


Reality
You're being very, very optimistic! I think that by the end of 2016 will not be sold more than 1 or 2 million... Because most people are not interested in vr...

saviornt
Level 4
Another edit, this time at beginning of thread 😄

You cannot compare a 4th generation device or other "known" techs to something that hasn't even had it's real 1st gen release. More comparable would be the IPhone 1 (see more below). By the time the IPad came out, people were getting used to having mobile devices and could relate to them (the mass majority cannot relate to VR HMD's). As for the PS4 and XBox sales, you can't compare those either, because the mass majority of those sales were from people that owned previous console generations and wanted to upgrade. A more suitable comparison, again, would be the sales figures from the PS1 or the XBox 1:

PS1: 2.6 million units sold in first year of release (1996)
XBox: 5.6 million units sold in first year of release (2002) - A larger number, one that I suspect was due to people getting more comfortable with consoles (PS1 / PS2).. see above in relation to the IPad sales.

2018 is a looooong time away as far as technology goes. I would suspect that by 2017 there will be at least 15 million units sold, almost doubling each year as barrier to entry prices drop, and hardware becomes cheaper and more able to run VR properly.



This is just a quick estimate based on my reservations. 2020 will be the year that VR goes "critical mass", and then it will start to taper off. I suspect that by then, we'll start seeing AR/VR starting to collide. By 2050, more than likely we'll start seeing implanted devices.

PS: That top line is 1.2 billion units sold. ❤️ excel.

But what do I know, I'm just some random guy on the interwebz

PSS:

I'm not entirely sure I agree with KZero's forecasts.. they seem way to optimistic for my tastes. According to them, there will be an active 6.1 million users by 2015 and 31 million users in 2016 (way above other forecasted sales).

Since the Vive is the only HMD coming out in 2015, by the end of the year.. do you really think that they are going to sell 6.1 million units in, at most, 3 months? Yea... right. Even the IPhone didn't have more than 2 million sales over the first 2 quarters that it was being sold. Even according to Apple, they only sold 4 million units within the first 200 days of it being released (and this is a highly suspect number)

Current WIPs using Unreal Engine 4: Agrona - Tales of an Era: Medieval Fantasy MORPG

kevinw729
Level 15
"saviornt" wrote:


[/img]


These quotes are so flawed that investment community executives looking at VR try to avoid them.

Most important of the omissions:

- do not include HMV (Head mounted viewers) that were converted for VR application (best example all those that used Sony HMZ's as HMD's by customization)

- no information on the military and commercial simulation / training sector stats (very difficult to get accurate DARPA and MOD info on HMD's used and purchased)

- no information on the educational and research stats (same as above, with some reservations)

These are just the basic variances with some of the calculation. I was interested in one s/reddit discussion where it was argued that Sony HMZ's should not be included, even used in VR under customization because they were not sold as VR devices. Even better I was told in a discussion that there had never been a HMZ / HMD sold in the consumer sector prior 2000:



After seeing this slide the individuals seemed not to answer any other questions!
https://vrawards.aixr.org/ "The Out-of-Home Immersive Entertainment Frontier: Expanding Interactive Boundaries in Leisure Facilities" https://www.amazon.co.uk/Out-Home-Immersive-Entertainment-Frontier/dp/1472426959

saviornt
Level 4
All of my assumptions in my post are based on what I think the consumer growth will be, not military or commercial aspects. As far as prior to 2014, sure, there were VR headsets sold, but more or less, they were designed for military/commercial systems. That isn't to say that consumers didn't buy or create their own versions, but when you're talking about millions, or even billions, a few hundred or even a few thousand means very little.

As far as financial growth in this sector, well.. I don't think that we (or any financial company) can say, with open honesty, how much this sector will grow. If they said that they can accurately forecast it, then I would have grave misgivings about them. It's the nature of the beast really.. do we think it's going to succeed and skyrocket? Yes, I firmly believe it.. but can I predict it with 100% accuracy? Nope, I cannot.

As far as HMV's are concerned, I think that there are 2 subsets of VR, immersive VR, such as the Rift, Morpheus, Vive, and the non-immersive VR. Non-immersive VR, as far as I know, didn't really kick off due to the high barrier of pricing involved. But then again, how much do we want to include in forecasts? For example, the original Viewmaster was a form of VR, do we include those sales? Or how about fully immersive "pods", those are VR.

So personally, all of my forecasts about this particular market sector are based around immersive VR headsets for consumers.

edit: And that graph wasn't really meant to show "accurate sales figures", but more or less to illustrate the sales trend. I got tired of explaining, in words, what an S curve was 😛 Although I did add the figures that I think would be accurate according to my magic 8 ball.

I should also explain a bit about 2014 - 2016, while the graph doesn't fully show it, I did include the sales figures for development kits, up to 2.4 million units sold by EOY 2016, it just doesn't register on that small of a screenshot when your top figure is 2.5 billion units.

edit: And you didn't include the Virtual Boy (1995), which shipped about 350,000 units world wide.
Current WIPs using Unreal Engine 4: Agrona - Tales of an Era: Medieval Fantasy MORPG