Limited VR adoption down to high costs and lack of advertising
In 2016, combined sales of Playstation VR units, HTC Vive and Oculus Rift headsets totalled just 1.7 million. In contrast, Apple sold 3.3 million iPhones within six months in 2007. The limited adoption of virtual reality (VR) technology can be attributed to its high cost, as well as companies' reluctance to advertise until wide-scale adoption can be modelled. The lack of a VR-dedicated blockbuster game or social media platform has also stemmed adoption. It could be five or 10 years before virtual reality meets public expectations, Oculus founder Palmer Luckey projected last year.

There’s no doubt that VR is something completely transformative, a new genre that makes its potential clear to anyone who pulls on a headset. “Imagine enjoying a courtside seat at a game, studying in a classroom of students and teachers all over the world or consulting with a doctor face-to-face—just by putting on goggles in your home,” Facebook CEO Mark Zuckerberg wrote after his company acquired Oculus in 2014. In fact, Facebook sees VR as an entirely new communication platform—something that will someday “become a part of daily life for billions of people,” the way Facebook is today.

I’ve spent all year exploring and testing the headsets, and it’s clear to me that Sony, Oculus, and HTC all delivered more than capable first-generation products. So why aren’t the sales numbers higher?

The most obvious answer is accessibility. The $800 Oculus Rift with Touch controllers requires a desktop computer approaching $1,000 (or more) to run, as does the $700 HTC Vive. Only dedicated PC gamers are likely to own a compatible system already.

That leaves PlayStation VR, which plugs directly into the 50 million PlayStation 4s already in homes around the world. But just a month after beginning to ship its VR headset, Sony revealed the new PS4 Pro. Both cost $400. Both appeal to PlayStation users. Like Oculus and HTC, Sony didn’t spend a lot of time advertising its headset.

Oculus founder Palmer Luckey told the Financial Times back in January that the first consumer version of its headset, which debuted in March but had its controllers delayed until December, would mostly appeal to hard-core gamers and early adopters. The company has maintained that it is taking a long-term approach, acknowledging that it could be five or 10 years before the technology is mature enough to fully meet the public’s expectations. By limiting advertising, headset makers are attempting to manage hype and focus on the smartest way to increase adoption.

That’s a tricky balance to strike with the most important part of the equation: content. Headset makers have drawn a few high-profile developers to their platforms, but there has yet to be a VR blockbuster. Developers want masses of paying players, while players are drawn to new platforms by high-profile content—whether that’s a blockbuster game or a heavily adopted social-media platform.

In the meantime, Sony, Oculus, and HTC are using novel experiences to attract smaller numbers of devoted users. Google’s Tilt Brush—a 3-D space in which you can use hand-held controllers to draw with Vive and Oculus—is essentially the VR version of Microsoft Paint. It’s basic fun, but completely mesmerizing to anyone willing to buy into VR in the name of trying a new technology.