Why Nobody Wants Virtual Reality (Part 4)

Facebook is gambling with a dangerous base to carry its next computing platform

This is the final Part 4 in a series “Why Nobody Wants VR.” In Part 1, I recapped my time at Stanford running its VR lab. In Part 2, I talked about how I innovated 360 imagery at Strivr. In Part 3, I broke down what I saw VR “empathy” mean to Hollywood.

It’s ironic to me that Facebook, which got its start in casual gaming via Zynga titles like Farmville, is now in the most hardcore niche of gaming: virtual reality. They’ve built a core of enthusiasts that I watch constantly debate each other on reddit forums, mostly about Facebook account merging and privacy. Battle lines are drawn over who cares where their Oculus data goes. It’s turning out that most people don’t care, or think the subsidization of both Facebook’s software and hardware via personal data is worth the surveillance.

The recent Oculus Quest 2 is selling well, more than all other headsets combined, but it’s important to remember how badly Facebook needs AR/VR to work in their favor. Strategically, they missed out on mobile hardware, and they can’t afford to do it again with whatever comes next. It’s not so much they think VR is a good idea, or that its usage trends are indicating explosive growth. It’s more that they want to own a hardware platform that doesn’t force them to engage in costly legal battles with Apple or Microsoft.

Video games likely are a means to an end for Facebook. Will they be enough to carry the next generation of computing forward?

As someone that doesn’t have a personal Facebook account, participating in its vision for the future of computing is increasingly difficult. I first left the platform in 2007, irked by its forced privacy changes, then again in 2012, then finally for good in 2018 after the Cambridge Analytica fiasco.

See above: an image of my own struggles in using a Quest given that I choose not to have a Facebook account (I ended up merging with my wife’s account so I could virtually attend Facebook Connect via its social app Oculus Venues).

Jaron Lanier, the pioneer who coined the term “virtual reality,” has experienced its hype cycles more than anyone else. I had the unearned honor to appear alongside him in a 2011 New Yorker feature aptly titled “The Visionary.” He once told me in an aside there were two reasons why VR failed to materialize in the past.

First, Lanier said that most people don’t want to wear a computer on their face. Second, he said that VR’s momentum in the 90’s was far eclipsed for excitement for the early internet. It wasn’t for VR’s lack of innovation or price, but that it couldn’t compete for a majority of attention.

Video games are no doubt, a huge industry. In 2020, titles grossed $56.9 billion dollars, up 27% from the previous year. It would seem like VR is poised perfectly to take a slice of the pie. But in the attention economy, consumer media is a zero sum game. Consumers make intentional choices about how to fill their fixed waking hours across social media, streaming, and video games. Reed Hastings said Netflix’s biggest competition isn’t HBO or Fortnite, it’s sleep. VR is the most intentional of these media options, as it requires complete focus and attention.

In this last essay, I argue that VR’s primary market fit in gaming is problematic because:

  1. VR’s new market is people that like doing

  2. Instead of marketing to those people, it doubled down on hardcore gamers

  3. These enthusiasts are at the heart of a toxic culture war with lots of virtual guns


VR is Something You Do

Developing a successful video game console is tricky. The graveyard of the past is littered with failures like CD-i, the 3DO, and the Virtual Boy. As someone that grew up with a deep affection for Sega and its Dreamcast console, I was crushed when it died. It wasn’t for a lack of innovation, which had mobile peripherals like Visual Memory Units, games with voice recognition AI, and the IP of one of the most successful franchises of all-time: Sonic the Hedgehog.

Still, those ingredients couldn’t add up to enough market share to compete with rivals Nintendo and Sony.

If not for lack of innovation, why do some consoles succeed where others fail? Recently, Amazon and Google have stumbled in their attempts to find success in the gaming industry. Both have shuttered their internal gaming studios after hemorrhaging millions into failed titles and technology. Stadia, Google’s video game streaming service, apparently missed user targets by hundreds of thousands. Executive leadership at Amazon micromanaged creative decisions and insisted that propriety tools be used or developed when possible.

Bloomberg wrote about the failures of the tech giants to move into video games, saying:

Successful video games are a combination of art, entertainment, technology and very large budgets. Big tech companies only really figured out the last two.

Xbox has an answer. Against all odds, Microsoft launched the successful video game console in 2001. Bill Gates only narrowly approved it, largely because of pressures from Sony claiming that PlayStation 2 was basically a “computer” in the living room.

Larry Probst, then the CEO of Electronic Arts, wanted accountability from Microsoft, saying things like “You guys don’t even know what it is to make a console” and “I want to know who gets fired if it fails.” Internally, the Microsoft engineers nicknamed the project the “Coffin Box” for its low odds of succeeding.

Yet, Xbox started a new era of console video games. It did so almost by accident, in part because of Microsoft’s risky purchase of Bungie to turn Halo into its launch title. At the time this was thought of crazy, since Bungie was strictly a desktop developer of first-person shooter (FPS) games, and most people thought those belonged on computers.

Ed Fries, then Microsoft’s head of first-party games, explained the breakout lesson of the Xbox this way:

What it showed was that we didn’t just create a clone of the PlayStation but that we were opening up a new market that was somewhere in between Mario and PC gaming.

Thus, Xbox+Halo created a new market for the types of games consumers expected out of a game console, paving the way for major franchises like Call of Duty.

To succeed, virtual reality similarly needs to create and reach a new market in the way that Xbox did.

One recent evening, while decompressing from the physical world in Fortnite, a random teen on my squad received a text message. He sighed deeply into his microphone and said:

Noah is texting me. He probably wants to do VR.

He lingered long and hard on the verb “do.” As if the teen couldn’t be bothered to pull away from Fortnite to “do” VR with Noah. Why didn’t he use a different verb? He could have said, Noah wants to “play” VR or Noah wants to “use” VR.

And that’s when it hit me. The teen’s candid comment condensed why VR remains niche, even among gamers.

VR is perceived as an activity to “do” as opposed to a place to go. That’s its new market: people who like doing things (Home Depot, eat your heart out).

This makes sense when you look at VR’s current most popular titles: rhythmic games like Beat Saber and exercise apps like Supernatural.

If VR is to succeed as a console in creating a new market though, it needs to find people that like doing and give them something to do. This new market of users probably likes traveling, outdoor recreation, and building stuff.

Unfortunately, many gamers don’t like doing, which is why they like gaming.

Just look at the fate of the Microsoft Kinect, a peripheral that in 2011 was the fastest selling consumer device of all time. Due to its initial success, Microsoft bundled a new Kinect with the Xbox One launch, but its price made it $100 more expensive than the PS4. Eventually the Kinect was scrapped entirely, without much resistance.

It turns out actively doing while gaming eventually lost its novelty, which Polygon covered in its article “All the Money in the World Couldn’t Make Kinect Happen.”

This puts VR in a tough place if its main demographic are the same gamers that lost interest in the Kinect. It also means VR consoles will compete zero sum with the same gamer market by offering less good versions of things that already exist for them.

Confirming what Lanier mentioned to me years ago, Kevin Roose of The Times recently put it best when he wrote:

“Part of the problem for virtual reality enthusiasts is that much of what a V.R. headset offers can be found in other places…We are creatures of habit, and it may be that people simply prefer virtual experiences that don’t require them to strap an expensive computer to their forehead.”


Serious Tech Fans Only

In 2015, Oculus was reckoning with its strategy and future. It hadn’t yet shipped a consumer device, and was toying with a mobile VR future through its partnership with Samsung. With the Facebook acquisition, Oculus was flush with cash, but unsure how best to spend it. It meant they could experiment with format, like the now defunct Oculus Story Studio, but that didn’t help steer the vision for what they wanted to be.

A long email from John Carmack, then Oculus CTO, was revealed by journalist Blake Harris in his book The History of the Future. Carmack highlighted the struggles on the leadership level, which included infighting about what makes VR special when it comes to games. Other applications were considered, but left out for launch. Carmack wrote about Facebook’s deep pockets, saying:

That gives us the freedom to experiment and explore, looking for “compelling experiences”, and discarding things that don’t seem to be working out. In theory, that sounds ideal. In practice, it means we have a lot of people working on things that are never going to contribute any value to our customers.

When the Oculus Rift finally did launch in 2016, it did so with a fizzle. It didn’t include any social features, something Carmack later lamented. The device felt more like a peripheral, like a joystick, then it did a revolution in computing. Adi Robertson wrote in its The Verge review, the perfectly titled “Virtual Reality is Always Almost Here”:

it’s not fundamentally different from any other intense gaming session, except that VR’s nearly mystical reputation primes us to blame or praise it for every unusual feeling we experience around a headset.

This to me is fair. VR’s storied reputation is tied into complex aspirations for computing, including my own. Facebook innovated plenty of the hardware pieces that were clunky and expensive, the kind we used at Stanford’s VHIL which I wrote about in Part 1. The harder part though, was marketing it. Was this new thing a PC peripheral? Or was it something more?

Marketing and brand communication is vital when it comes to shifting consumer behavior. It’s hard to sell a vision of the future different than the way we do things now, and consumers need to be shown that future.

The rise of personal computers in the 80’s and 90’s was due in part to how they first solved problems for institutions with tools like email, text documents, and spreadsheets. Take public libraries for example, which could finally categorize books electronically instead of on physical Dewey Decimal index cards. IBM rose to power because this approach was literally in its name: International Business Machines.

Apple shifted the narrative using its Think Different marketing campaign, which convinced consumers that computers were also meant for them. Personal computing took off throughout the 90’s, and set the consumer behavior expectations that allowed smartphones to appeal first to consumers, not businesses.

To make matters more challenging, Facebook was tasked with marketing Oculus devices during a time it was struggling with its own brand image. Products don’t exist in a vacuum, they reflect their brand’s beliefs and attempt to bring in believers. A VR device from Facebook was always going to reflect a perspective of ignoring privacy, unless it heavily marketed something else. But it didn’t.

Instead, it overlooked its brand tax and debuted a “Change the Game” Rift launch trailer:

This wasn’t anything like the multimedia campaign that drove Apple to computing success. It was for hardcore gamers, set to a deep techno track and slow motion effects. I love video games, and even I felt exhausted by the future marketed by Oculus.

When the Oculus Go launched in 2015, there was a pivotal opportunity. The headset was the company’s first standalone device, and it was priced competitively with consoles like the Nintendo Switch. More importantly, its marketing campaigns communicated that you didn’t need to be gamer to use it! Just watch the incredible “Open Your Eyes” ad spot below:

This spark continued with an ingenious marketing campaign to put celebrities in headsets and poke fun at how dorky we all look when wearing one:

Both the ad spots above were a much needed levity from the intense gamer appeal previously. Unfortunately, they pivoted away from this more accessible vision with the launch of Oculus Quest, another standalone device that catered to gamers. Just look at its marketing materials for developers, which segments its demographics into varying categories such as “Dedicated Gamer” and “Play-to-Win Gamer.”

Facebook made it clear with its Oculus Quest 2 launch trailer that it was going all-in on the device as a video game console for the “serious tech fans” market:

Who are these enthusiasts though, and are they enough to carry the console’s future?


All Aboard the Bullet Train!

I still remember my first kill in virtual reality.

It was at the Dolby Theater in Hollywood, where the Oscars are usually held, as part of the Oculus Connect 2 conference in 2015. I was given a shotgun, told to step off a train, and proceed with fighting an onslaught of baddies. These enemies moved and looked like humans, and it was my job to use as many bullets as it took to stop them. Shoot reload, shoot reload, shoot reload. It was a rhythmic mass shooting event, set to another deep techno track. The experience was called Bullet Train, and it was built by gaming giant Epic Games (with a possible voice over by Reid Hoffman, but I can’t verify that anywhere).

I’m no stranger to guns, virtual or physical. I grew up on a extensive line of competitive shooter games like Unreal Tournament, Counter-Strike, and Call of Duty. Over my career, I’ve probably killed, or “fragged” as the term gamers prefer, upwards of tens of thousands of players represented by human avatars. I also deer hunt in real life, using a rifle, and know what it’s like to use it to kill another living animal. I don’t take hunting, or gun safety, lightly. Much of my graduate career was spent in environmental ethics classes, tangling with the moral philosophy of conservation and culling wildlife.

Still, shooting another humanoid in Bullet Train felt felt different than my other two-dimensional gaming experiences. When I finally took off the headset, exasperated and numb, I wanted to weep at my brain’s cognitive dissonance. It felt like what I feel after I shoot a deer.

Bullet Train would go on to demo at the Conservative Political Action Conference a week after the Florida Parkland school shootings, which forced an apology from Facebook. Developers from Epic Games struggled with Bullet Train’s portrayal of gun violence, using lessons it learned to inform its later title, Robo Recall. Most important was replacing the humanoids with robots. Epic Games Art Director Jerome Platteaux said in a Polygon interview:

It was hard to make sure the game was fun but not a murder simulation. So we made sure it’s colorful, it’s fun, it’s arcadey so people feel good coming back and not feeling like killing people again and again. Bullet Train was slightly on that path, we were shooting human with suits. So that was the first thing, we made sure we’re not shooting humans anymore. We’re going to make sure the robots look like robots...Even in the design of the gun, we weren’t trying to make them too real, or too close to the real one. We added some futuristic stuff so it doesn’t feel too bad.

Who gets to decide when the experience “doesn’t feel too bad,” though? And what happens when other other developers don’t care to make the same moral choices to replace humans with robots?

Well, we end up with something like Medal of Honor: Above and Beyond. Murder simulation, indeed.

When I looked around at the cohort of people at Oculus Connect 2, it seemed like I was the only one that felt conflicted. The attendees weren’t academics, business bros, or even cultural thought leaders. They were hardcore gamers and game developers. Some were dressed in flashing LED lights and metallic spray painted sunglasses. The conference halls were flooded with cyberpunk and steampunk enthusiasts.

They were having a blast blasting away, using new motion tracking controllers to duck and dodge bullets.

Facebook knows these people well by a different name: hackers. In fact, it was built by one. He amassed a digital Rome using the motto “Move fast and break things.” That was before we knew the thing we were breaking, was people. “The Social Network” captured this era with its intern competition scene:

To truly understand enthusiasm for virtual reality, is to understand the culture and subcultures it exists within. With the rise of personal computers in the 80’s and 90’s, hackers represented the pinnacle of counterculture. Computing gatekeepers, ISP’s like CompuServe or closed hardware platforms like Apple, were reviled. They were Britain, and hackers were the freedom fighters reclaiming their digital America.

Just watch Julia Stiles in her Ghostwriter role, saying cringe hacker phrases like “jamming with the console cowboys in cyberspace” and “a world where curiosity and imagination equals power”:

The internet didn’t exactly pan out in the pastoral way we once imagined. It made us more divided, more vulnerable to foreign subterfuge, and subsidized a lot of unsustainable on-demand services. It didn’t make us more educated, more ambitious, or happier. We’re still stuck with systemic workplace issues like racism, sexual harassment, and burnout.

Hackers didn’t save us. Instead, they used their wits to create startups that put them unprepared in leadership roles. Massive carrots from venture capital steered them towards exit packages and stock sales, making hackers an ironic part of a capitalistic system they once reviled.

VR certainly doesn’t deserve all this blame, but Oculus Connect 2 was an early alarm in what it was promising its gaming community with Bullet Train. The enthusiasts were clamoring for a Metaverse, for full motion gun controls, for an entirely new social fabric.

The problem is, if Facebook continues to build for these enthusiasts first, it’s going to be increasingly difficult to steer the ship later. Gamers are a dangerous base of users, as Gamergate and the culture wars of lately have exposed. Deeply heartbreaking is Jennifer Scheurle’s letter “Dear Player: I love you, let’s talk,” where she details the abusive relationship between gamers and the people that make games:

Sometimes people tell me they wish I was dead, or worse.

Is an industry full of misogyny, toxic player communities, and abusive work standards really who we want steering the next computing platform? Do we really want to be fueling America’s gun-obsessed soul with the fire of more Bullet Trains?


An Ice Cold Conclusion

VR has long promised us a more naturalistic platform by using novel inputs. Just turn your head to look! Move your hands! But button mapping hasn’t become easier, it’s more complicated. You know who struggles with using an Oculus Touch motion controller? People that already struggle with using anything that remotely resembles a video game controller.

The challenge is that the digital divide is expanding with VR, not collapsing. Video games have developed a common language over the last couple decades which have weeded out those that became overwhelmed with things like 3D joystick navigation, hit points, and inventories.

Brie Code best captures this divide in her incredible article “Video Games are Boring”:

I'm not remotely interested in shockingly good graphics, in murder simulators, in guns and knives and swords. I'm not that interested in adrenaline. My own life is thrilling enough. There is enough fear and hatred in the world to get my heart pounding.

By doubling down on hardcore gamers as its niche, VR misses out on bringing in a demographic of users that could really use it to do things. It’s telling that during a pandemic we didn’t turn to VR, which was cheaply accessible via Oculus Quest, we instead turned to Zoom. It was the easiest tool to use across all types of people and ages.

VR has a potential to create a “new medium,” as Hollywood artists would say. I’ve experienced some really fantastic experiments at film festivals and events over the years, but those things aren’t easily accessible. They’re not something consumers generally understand, or can even access easily on the Oculus store. The best ones don’t ask users to press buttons at all. They use inputs like or voice or head movement to play out stories in complex ways.

The best vision for VR I’ve seen has nothing to do with a headset. It’s an episode of HBO’s The Leftovers, where the protagonist wakes up in an alternate reality as an international assassin and must complete his mission. It’s similar to how my lucid dreams play out: usually a lot of talking to a lot of people. It plays out like the game Facade, where conversation is the game mechanic in a relatable domestic dispute:

It’s just that I’m so tired of shooting robots and zombies in VR, especially when there are many other interesting and social things to do elsewhere. I spent most of time over the last quarantined year alongside my kiddos in places like Fortnite, Minecraft, Animal Crossing and Among Us. My wife and I even cooperatively tend to our farm daily in Stardew Valley.

All of these games are living, breathing, virtual worlds that offer little cognitive cost to play. The continual success of the Nintendo Switch has shown how tremendous this casual gaming market can be.

This is of course, all futuristic speculation. Like most predictions, I’m probably wrong about the fate of virtual reality.

Maybe VR is a bit like the commercialization of frozen ice. In the early 1800’s, using ice to chill beverages wasn’t commonplace. Once the practice was commercialized by Frederic Tudor and the shipping technology possible, it took a long time to convince people it was a necessity. As Mental Floss writes,

The truth is that people never knew they needed ice until Tudor made them try it. Once they did, they couldn't live without it.

Will virtual reality go the way of a frozen ice, and eventually become a household staple?

After many years of trying to bring the technology to non-enthusiasts, it’s time that I step away from it for a bit. VR needs what I alone can’t give it: a slow, perfect storm of factors working together to shift consumer opinion about what else it can be. Maybe we’re already in that storm right now, and only by looking back later, will we know for sure.

In the mean time, you can find me stuck in the storms of Fortnite.


Addendums

Deep thanks to those of you that stuck around for this labyrinth of a career postmortem, as well as everyone that was part of its decades long journey. I’m excited to soon share what I’m working on next with my best dude, Jordan Kutzer!

The views represented above are my own, not of my company Blue Trot Group or any of its partners, affiliates, or clients.

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