Hi there! My name is Janko Roettgers, and this is Lowpass. This week: The state of VR, and the never-ending Redbox saga.

Relax, grown-ups: VR is doing fine

When news broke last week that Meta may cut the budget of its Meta Reality Labs unit by as much as 30 percent, followed by reports that the company is delaying the release of future headsets, pundits immediately jumped on this to proclaim that the metaverse, and by extension VR, is dead.

“Meta slashes budget as VR dream implodes,” declared IBT, and Bob O'Donnell from Technalysis Research argued that “VR was never the right choice.”

That discussion got muddied by the fact that both Meta and its critics often use the terms metaverse and VR interchangeably. Reality Labs is widely being described as the company’s metaverse unit, although it now makes AR and AI wearables, VR hardware, and the company’s Horizon Worlds metaverse platform. Ever since rebranding as Meta, the company has also described a wide range of bets on immersive tech as metaverse-related, with Meta CTO Andrew Bosworth insisting this week that the metaverse would eventually play a role in everything from VR, AI, and wearables to even robotics.

Meta’s actual metaverse efforts have been focused on its social VR platform Horizon Worlds, which has long struggled to gain traction. Immersive industry insiders I talked to were hardly surprised that the company may cut back on some Horizon Worlds investments. But the reported severity of those cuts, along with suggestions that the company may stop subsidizing VR hardware, had even those insiders worried, with some wondering what all of this meant for the future of the medium.

Adding to these concerns are real issues facing the VR gaming market. Meta closed VR studio Ready at Dawn last year. Toast Interactive, the studio behind the pioneering VR game Richie’s Plank Experience, laid off most of its staff in February. VR game maker Phaser Lock Interactive shut down a month later. Canada-based Archiact and Sony’s London Studio, which had been building games for PlayStation VR, also closed.

I’ve got good news: VR is alive and well. It’s just very different from what we all had imagined it to be.