How VR and AR became the dominant medium for entertainment and communication

Part 1: The foundation of the next human (r)evolution

As a content creator and evangelist of Virtual Reality (VR) and Augmented Reality (AR), I am often asked: What will it take for the tech to truly reach mass market and most importantly, how long?

The short answer is that in some way we are already there. The long answer is a bit more complicated than that. So lets go back in time.

The rise of the video game industry

I remember fondly the days when I used to go to the arcade after school to play video games with my friends, inserting coins after coins for a few minutes of fun, trying to beat each other or get close to the highest scores. That was already the end of an era that started in the 80’s. Full neon rooms of machines, each worth between $30–50k each. Games that nowadays wouldn’t weight more than a few kilobytes on our phones.

Then came the age of internet cafes, gaming PCs and high speed internet. There we could spend entire weekends glued to our screens, competing against players from around the world. I was about 16 at the time and it took another 5 years for me to get my own high end PC and a good enough internet connection to replicate the experience from the comfort of my home.

Please bear in mind, I am what you call an early adopter. At this time, the industry was very far from the $135 billion market that it is today.Targeting almost exclusively young males, the biggest titles where usually fighting/war games, car racing games or online role playing games. The platforms of choice were almost exclusively PCs and consoles and therefore required a substantial investment, especially if their sole purpose was to play games.

2017–2021 Global Games Market / Newzoo

So how did this rather niche sector that took 35 years to reach USD 35 billion in 2007 became the biggest and most profitable form of entertainment in 2018?

Growing at an annual rate of more than 9%, the video game industry has already eclipsed Music, Cinema, TV and Books.

The snake changed the game forever

While it’s easy to believe that video games are still primarily consumed by white adolescent males, partly thanks to the type of adverts we see in the media, this couldn’t be further than the truth.

Actually, most chances are that YOU are part of the 2.5 billion players and so is your mom. Welcome to the club!

Today, the average video game player is about 35 years old and its fairly balanced between the sexes.

Surprised about those statistics? Let’s dive a bit further into the mobile market that as you may have already guessed by now, was the key instrument in this new revolution.

The first mobile game sensations were undeniably “Snake” and “Snake II” on the then hugely successful Nokia phones, king of phones for almost 10 years in the late 90’s, early 2000’s. For the first time, 100s of millions of users had access to video games essentially for free as it came already installed on all devices. This was the start of a new and very important demographic for the video game industry — the casual gamer.

Then of course came the iPhone and the launch of the app store in 2009 and 2010, allowing video game developers to sell their games directly to the end user. This is when the mobile game industry truly started.

Mobile Game revenue growth from 2012 to 2021 / Mediakix

Data show that in 2012, the mobile game market was already generating a healthy $12.7 Billion in yearly revenue. It is estimated to pass the $100 Billion mark sometime around 2021–22, accounting for more than half of total gaming revenue.

What is particularly interesting about the mobile game market is that it essentially didn’t exist 10 years ago. However, for sometime now, it has become our go to source for entertainment.

It’s also important to point out that, contrary to general believes, this market is largely dominated by women consumers (63%). This is in part thanks to some of the juggernaut titles like Candy crush saga and Pokemon Go targeting a more gender neutral audience. While the video game and tech industry as a whole still has a lot of work to do to fight gender bias, it has everything to gain doing so.

Finally, coming back to the Pokemon Go phenomenon, it is important to note that it is one of the first successful games to make a big use of Augmented Reality technologies. Not only that but it is also today, the highest grossing mobile game worldwide, generating almost $1.5 Million daily. You read that right. Daily.

In 2018, the top title of the dominant form of entertainment is an Augmented Reality app.

Pokemon Go / Nintendo, Niantic

The story doesn’t end there though. Far from it. You see, VR and AR are not meant to be on smartphones. The only reason it exists on mobile is for the general public to try the tech, inspire and allow developers to invent and test new solutions on the cheap.

The whole point of those two mediums is the concept of immersion. For this to happen, one basic requirement is for you to be at the centre of the experience and ideally hands free. While Pokemon Go does use some early AR technologies, the fact that you need to hold a tiny screen to peek into this virtual world breaks some of the fundamental qualities of what true AR is.

As a matter of fact, true AR has much more challenges to solve than VR and will take several more years to be an ubiquitous technology. But this is for a next chapter.

In my next posts, I will dive deeper into the similarities and differences of the two technologies, their growing pains and how they’ll ultimately redefine who we are as humans.

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