Microsoft is banking on social platforms for VR adoption

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Social interaction will be a key use case for driving virtual reality (VR) adoption, according to Alex Kipman, a technical fellow at Microsoft.

At the Windows Mixed Reality (MR) event last week, Kipman revealed Microsoft’s aim to use social platforms to wiggle into the VR market, according to VentureBeat. The company originally made a push into the augmented reality (AR) market with its HoloLens headset.

Microsoft has already made moves in the social VR space with its acquisition of social networking VR startup, AltspaceVR. Microsoft acquired AltspaceVR when it was on the brink of shutting down due to lack of funding. Altspace lets users gather in a virtual world to play games, watch sports, listen to music, and hang out with celebrities. Already a pioneer in the social MR space with support for platforms like Oculus Rift, HTC Vive, Google Daydream, and Samsung GearVR, Altspace will likely help Microsoft catch up in the ecosystem.

A focus on social could help Microsoft overcome two major obstacles to VR adoption:

Lack of content. For Microsoft’s platforms to flourish, developers will have to publish more apps that offer new VR experiences. However, in 2016 just 9% of developers were creating content for Microsoft, compared with HTC Vive and Oculus Rift, with 49% and 43%, respectively. A dive into social VR will likely lead to the introduction of more apps into the space as developers jump on board to get a piece of the growing social VR market, which lays the foundation for opportunities beyond gaming and entertaining.
A need-to-have app. VR is missing a game-changing app that will catalyze adoption of the platform. While developers are creating content for the VR space, a robust offering of unique VR content, such as social VR, will likely push consumers to make the leap.

Microsoft will need to differentiate its social VR platform as it enters a market where several key players are battling to establish themselves. Facebook was the first to announce a social VR platform, Facebook Spaces for Oculus Rift, at its annual F8 developer conference. HTC announced in May that the company is launching its own social VR experience, where HTC Vive users will be able to communicate with each other through an integration with Tencent’s WeChat.

New VR headsets like the Oculus Rift and the HTC Vive debuted amid great consumer anticipation, while VR content launches kept pace, with Batman: Arkham VR and Chair In A Room garnering encouraging download totals. At the same time, industry groups and conferences brought developers, investors, and content producers together, helping to further ramp up buzz in this nascent space.

VR headset shipments will continue to grow in the years ahead, driven by the introduction of new content that will appeal to a broad swath of users.

Jessica Smith, research analyst for BI Intelligence, has compiled a detailed report on virtual reality that:

Identifies the major players in today's VR hardware and platform markets.
Estimates future growth of each of the major VR categories.
Explores barriers to mass market consumer adoption for each of the VR hardware categories.
Considers how developer sentiment is driving the growth of various platforms.
Assesses how the market will shake out over the next five years in terms of size and the success of various VR hardware categories.

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