As the entertainment industry is constantly evolving, the latest hot emerging markets involve virtual reality. While major motion picture studios previously dabbled with 3D exhibition of feature films, Hollywood is now on a mission to fully immerse the audience into the realm of virtual reality (“VR”). The goal of VR is to transform traditional viewing into a new reality in that the audience can become fully engaged in their own unique viewing experience.
In the early 90s, there were several attempts to mainstream VR but, due to the high cost of the hardware and the seemingly lack of customer demand, VR was unable to make a major foothold in the marketplace. Over the last 20 years, major advancements in technology – especially in the areas of motion sensory, digital technology and the decrease in overall hardware costs – have given developers and content creators a second chance at expanding the capabilities of VR.
The once afterthought VR world is now being led by key players such as Sony (Playstation VR), Facebook (Oculus Rift), Samsung (Samsung Gear VR) and Google (Google Cardboard). The VR market that was estimated around $4 billion in 2016 is expected to grow over $40 billion by the end of 2020. VR is currently being utilized in multiple industries such as healthcare, education, mental health and retail, in addition to entertainment.
With the return of VR to the entertainment scene, several studios, developers and investors are joining forces to capitalize on this new market trend. With companies investing billions of dollars, IMAX has been leading the way in the VR exhibition space, inking several deals with major studios and production companies. While the VR technology is not available yet in traditional IMAX theaters, IMAX has created the “IMAX VR Experience Centre” which allows the consumer to enter into fully interactive worlds influenced by studio feature films, such as Lionsgate’s John Wick Chronicles and Disney’s Star Wars: Trials On Tatooine. Several other deals with IMAX VR include Warner Bros., Skydance Media and Ubisoft, creating new opportunities to showcase and promote their new releases using this cutting-edge technology. IMAX currently has a VR Experience Centre in Los Angeles which opened on Jan. 6 of this year but hopes to expand to 10 additional locations worldwide by the end of 2017.
With all the hype surrounding the shift to VR, there are still major challenges that the industry must overcome – avoiding an uneasy stomach! One of the biggest complaints by consumers thus far is the feeling of motion sickness due to experiencing visual movement while remaining stationary. This feedback may deter others from the VR experience and prevent further growth of the industry. While not every consumer experiences motion sickness, developers are testing different options (i.e. high frame rates) to create a more enjoyable experience for all.
With the VR industry expected to rise exponentially within the next three years, here are some questions to think about for the future:
- Regarding feature films and TV series, will VR continue to be solely utilized as a promotional tool or will it become a medium of its own?
- Will the initial implementation costs deter exhibitors from adopting the VR platform in their theaters, and will major film studios need to contribute to these costs, similar to the transition from physical to digital prints?
- Will studios’ profit definitions need to change to reflect the reporting of VR to profit participants?
- How will revenues derived from the “VR Experience Centre” and other similar licensing deals be reported to profit participants?
Only time will tell if VR in the entertainment industry will be a short term fad like laserdisc or here for the long term, changing the way we consume content forever.