HTC’s global product manager on VR’s “race to the bottom” • TechCrunch

HTC’s global product manager on VR’s “race to the bottom” • TechCrunch

It was the year of the XR. But then they all seem to be these days. Strong presences from Meta, Magic Leap, Sony and HTC led the way at this year’s CES, with hundreds of startups pitching in. I was dazzled by a few demos, but ultimately wondered what form a true mainstreaming of AR/VR might eventually take—if it ever actually takes such a form at all.

There’s something about the technology that feels warm and welcoming, after a long day on your feet, gland moving across Las Vegas venues. Strap on a headset and feel the show floor slip away for a minute or two. I think most people who try these technologies in this context will get it, but there are currently far too many barriers to getting these products on most people’s faces.

Good VR is still prohibitively expensive. The content is also quite limited. Both of these factors are moving in the right direction, certainly, but it’s a big, open question whether they’re doing so at a fast enough clip to hit critical mass in this iteration of the multi-year hype cycle.

HTC’s approach is still baby steps. It’s the recognition that – despite years of hearing otherwise – true mainstream adoption is still some way off. Meanwhile, that means focusing on a core audience. That means being okay with remaining a relative niche – a far cry from the Taiwanese manufacturer’s high-flying days as a phone maker – while chipping away like the great blocks of granite that stand between it and the general public.

For HTC, the Vive XR Elite was the star of the show. At $1,099, it’s a few hundred dollars cheaper than Meta’s Quest Pro, but still far too expensive to see as some sort of breakthrough for the industry at large.

“This is for an audience that wants an upgraded experience,” said Shen Ye, the company’s senior director, global product manager in an interview with TechCrunch, “gamers and just people who want a good headset that’s comfortable.”

At this point in the evolutionary process, it may be unfair to set the bar for success at an XR headset in every home. Leap Motion’s well-publicized battles are a decent barometer here. Even more so is the fact that the company made a direct turnaround to business. There’s a lot of money to be made selling products to businesses—certainly more than there seems to be kicking around for pure consumer plays.

HTC has undoubtedly made some impressive gains here. I can’t say I spent a ton of time in the XR Elite, but the headset was as comfortable and engaging as advertised. It’s a piece of the puzzle that has long felt like an afterthought to the producers. It’s a strange thing to overlook in a piece of hardware designed to sit on your face for long stretches.

Image credit: HTC

Ye likens potential buyers to gamers who have patiently – and frustratingly – waited for the arrival of a pro version of Nintendo’s popular convertible console

“To this day, people still want a Switch Pro,” he tells TechCrunch. “They want something portable, but they want something better. Mobile VR is currently like this. It’s not a decent upgrade. People who want a good experience are stuck with these products that are racing to the bottom.”

The “race to the bottom” he refers to here is precisely the most important talking point related to mainstream adoption: price. The market has been flooded with affordable VR solutions for years, from Google Cardboard/Daydream to Samsung Gear VR to thousands of products and companies you’ve never heard of. One could credibly argue that these things ended up doing more harm than good. They did a good job of getting a version of virtual reality into a lot of hands, but when that experience isn’t particularly good, it’s easy to see people writing off paying a lot more money for VR in the future.

“I think one day there will be much cheaper headsets,” Ye says of HTC’s efforts. “But right now our focus is on how we better drive the market to make it better, to be more inclusive, to have better experiences.”

One thing is certain: HTC is committed to VR on a level few are. Vive hardware and related software/metaverse technology is the company’s primary focus, as the phone business has dwindled to a trickle (remember last year’s “metaverse” phone, the Desire 22 Pro?). The company’s future depends on its ability to push VR/XR forward. It can be a difficult line to walk, being all in on a technology while remaining pragmatic about the speed and scale of its potential growth.

Many in the industry expect validation from Apple in particular. The hope is that the company will enter the AR or XR category with guns blazing, and the buzz will be a tide that lifts all boats.

“I think the beauty of Apple coming in is that they’re not a social media company,” Ye says. “The giants that are really trying to disrupt are in this race to the bottom, making cheap headsets that are losing money. At the end of the day, what is the cost of your personal data? We are not a social media company. Our business model doesn’t rely on advertising revenue, so it’s not something we do. We want to build good hardware.”

Read more about CES 2023 at TechCrunch

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