Bank­ing on virtual re­al­ity

By now, it should be fairly ob­vi­ous that virtual re­al­ity (VR) is the next big thing in the video gam­ing in­dus­try, but is it go­ing to be noth­ing more than just a pass­ing fad? We spoke to Nel­son Ro­driguez, the Mar­ket­ing Di­rec­tor of the Global Games In­dus­try

HWM (Malaysia) - - GAX - by Peter Chu

Should video game de­vel­op­ers con­cen­trate their ef­forts on pro­duc­ing virtual re­al­ity con­tent in­stead of con­ven­tional games? Is there a mar­ket that’s siz­able enough for de­vel­op­ers to thrive solely on VR games?

The mar­ket for virtual re­al­ity (VR) games is still de­vel­op­ing. The in­stall base for all head­sets, in­clud­ing the more af­ford­able mo­bile-ori­ented de­vices, is small com­pared to all other ways to play games. How­ever, that is chang­ing rapidly.

From a busi­ness point of view, VR games are still a fi­nan­cial risk right now, so it is im­por­tant to con­sider fund­ing models in the short term. Key hard­ware mak­ers are all in­vest­ing in con­tent, which means there might be a way to mit­i­gate risks through those plat­form funds. Ul­ti­mately, what mat­ters most is the ex­pe­ri­ence that video game de­vel­op­ers are try­ing to build – VR or other­wise. The medium of the game should give de­vel­op­ers an op­por­tu­nity to do some­thing pow­er­ful with it.

How can brands and com­pa­nies lever­age on virtual re­al­ity in terms of ad­ver­tis­ing?

Ad­ver­tis­ing in VR rep­re­sents both risk and po­ten­tial. On one hand, users di­rect their own ex­pe­ri­ence and view, which means the typ­i­cal in­ter­rup­tion and over­lay models will not be nat­u­ral fits for VR. On the other hand, im­mer­sion in VR al­lows for deeper brand in­te­gra­tion.

Imag­ine sit­ting in the driver’s seat of a car you have been con­sid­er­ing to buy, or walk­ing onto the bal­cony of a cruise ship suite you re­cently re­served. It would be op­ti­mal, with­out a doubt, if those ad ex­pe­ri­ences were na­tive to the games they are built into.

Con­sid­er­ing that VR is still catch­ing on in most coun­tries, is it still fi­nan­cially vi­able for ad­ver­tis­ers and video game de­vel­op­ers to in­vest their re­sources in the medium? Is there a pos­si­bil­ity that VR will fail to catch on?

VR is not go­ing away. I just played a game demo from In­som­niac Games that deeply im­merses and en­gages the player dur­ing the game­play. We are just start­ing to see some de­fin­i­tive ex­pe­ri­ences on hard­ware that is still ma­tur­ing. When the head­sets get lighter and wire­less, and with higher res­o­lu­tion, we can ex­pect to see higher adop­tion. There are con­cerns that VR will not catch on as quickly as the en­thu­si­asts would like. There’s a risk of dis­il­lu­sion­ment and I my­self have been be very con­ser­va­tive about VR, but I am start­ing to see games that will be hard to re­sist.

What about aug­mented re­al­ity? Poké­mon GO has shown the mon­e­ti­za­tion po­ten­tial of aug­mented re­al­ity, so how else can brands use the tech­nol­ogy to their ad­van­tage?

Aug­mented re­al­ity (AR) mon­e­ti­za­tion can be con­sid­ered an old con­cept – spon­sored re­views us­ing ge­olo­ca­tion have been around since the early days of smart­phone app stores. Back in 2011, my team con­cep­tu­al­ized an ad­vergame that would en­cour­age players to visit re­tail lo­ca­tions to help drive pre­orders. As com­put­ing power in­creases, and geospa­tial data be­comes more ro­bust, there will be sig­nif­i­cantly more op­por­tu­nity with AR ad­ver­tis­ing.

Do you think aug­mented re­al­ity is more lucrative to ad­ver­tis­ers than virtual re­al­ity due to its wider reach – in the sense that any­one with a de­cent smart­phone is able to en­joy AR, while a ded­i­cated head­set is re­quired for peo­ple to in­dulge in VR con­tent?

Aug­mented re­al­ity’s po­ten­tial goes well be­yond ad­ver­tis­ing – not only is the hard­ware ubiq­ui­tous (ev­ery phone is an AR de­vice), AR is also more ac­ces­si­ble for most users as it does not re­quire users to be sep­a­rated from the world around them. While VR trans­ports the user at a high at­ten­tion cost, to a sim­u­lated world, AR sim­ply over­lays sim­u­la­tion onto the user’s real life. This has great po­ten­tial for train­ing, tech­ni­cal sup­port and medicine, et cetera – there is so much that AR can make pos­si­ble for ev­ery user. Ad­ver­tis­ing will find a nat­u­ral fit there.

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