Turns out Meta is a VR monopolist, after all
Welcome to Lowpass, a newsletter about the future of entertainment and the next big hardware platforms, including smart TVs, ambient computing and AR / VR. This week: A reality check on Meta’s VR hardware dominance.
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New data: Meta’s Quest 2 headset dominates the VR market
Maybe the FTC was onto something with its failed lawsuit against Meta? Just weeks after courts gave Meta the green light to acquire the VR fitness app Supernatural, we’ve got some new data showing just how dominant Meta is in VR.
Meta is a lone giant in the VR space, according to new data from Plume, which makes routers and also supplies its software to ISPs and other companies with large router footprints. For instance, if you have a mesh router from Comcast at home, it’s running Plume’s software. And if you use a wireless VR headset with that router, it’s all but certainly a Meta Quest.
99.7% of all wireless VR headsets in homes using Plume’s networking software are Meta devices, according to data released by the company this week.
It’s worth noting that Plume only tracked wireless, standalone VR headsets. Its data didn’t include Sony’s PlayStation VR headset, for instance, and wouldn’t include the newly-released PlayStation VR 2 headset either, as both rely on a wired connection to the company’s game console.
Also missing from the data are any wired PC headsets, including HTC’s Vive or the Valve Index headset. However, we know from Steam data that Meta’s Quest 2 also accounts for 44% of all PC gaming. Including its Rift and Rift S PC VR headsets, Meta’s hardware is responsible for 63% of all Steam usage, according to the company’s January survey.
More importantly, there’s virtually no competition for Meta in the wireless / standalone VR headset market. Hardware from Pico or HTC amounts to all but a rounding error in Plume’s data.
Meta has sold 20 million Quest 2 headsets. The Verge’s Alex Heath was able to report this new data point after it was shared at a meeting with “thousands of employees” of the company’s Reality Labs division this week. Meta hasn’t made this data public, but it’s fair to assume that the company wasn’t too worried about it leaking if it shared it this widely internally.
The most recent data we had about Quest 2 sales came from Qualcomm’s CEO, who told investors in late 2021 that the company had sold 10 million headsets.
If correct, this suggests that Meta doubled its Quest 2 sales since the beginning of the 2021 holiday shopping season — not bad for a device that was first released in 2020.
It’s also worth noting that we are now way past Mark Zuckerberg’s estimate for what it would take to build a self-sustaining developer ecosystem around VR, which he pegged at around 10 million devices.
Now, it’s all about retention. When Zuckerberg first floated that number in 2020, he was actually talking about 10 million active devices — and keeping people hooked has been a challenge for Meta.
That’s especially true for those who didn’t snap up a Quest 2 the first chance they had, but bought one more recently. Mainstream consumers, not early adopters. “The people who bought it this last Christmas, they’re just not as into it,” Meta VR exec Mark Rabkin told employees this week, according to Heath.
There are some signs that the company wants to improve retention: Meta just announced that it will turn its popular VR game Population: One into a free-to-play title this month.
Balancing innovation and mass appeal is the biggest challenge going forward for Meta. The company’s Quest 3, which is coming out later this year, will feature mixed reality pass-through and more powerful processing, which will result in a higher price than the current Quest 2. To balance this out, Meta is reportedly looking to release a more aggressively-priced consumer headset in 2024. Looks like Meta isn’t ready to give up its front-runner position in VR any time soon.
Apple’s Major League Soccer era has officially begun. Apple streamed its first game of the 2023 season this past weekend; the company has MLS rights for 10 years.
Metaverse creator Neal Stephenson on the future of virtual reality. His definition of the metaverse includes “there’s lots of people in it,” which seems to be more challenging than some companies thought it would be.
Winamp plans to relaunch in April. The iconic MP3 player has “the ambition of revolutionising (sic) the relationship between artists and fans,” according to a press release.
YouTube is developing generative AI features for creators. “AI presents incredible creative opportunities, but must be balanced by responsible stewardship,” wrote YouTube’s new chief exec Neal Mohan in a letter outlining his priorities.
Senators: Don’t let kids use Horizon Worlds. Two senators are asking Meta not to open up its social VR world Horizon to underage users.
How’s your week been? I took a few days off earlier this week to refresh, regroup and enjoy some fine craft beers (not necessarily in that order). I did also manage to catch a glimpse of the snow in the Northern California mountains, if only from afar. Hope you are staying warm and safe, and see all you next week!