This week, Meta (META) announced its Quest 3 — the company's most affordable VR headset to date. The timing wasn't an accident — Apple (AAPL) is expected to announce its mixed reality headset at the iPhone maker's Worldwide Developers Conference next week.
The VR market is accordingly getting more attention than it has in a while, but the question still lingers: What actually are we supposed to do with these headsets? Gaming, sure, but it seems there's not yet a must-have "hero" app for VR yet.
As it turns out, that's pretty much the case — and part of what's held VR back: a hero app, something people absolutely need to buy a headset to play or use. Think about it — what facilitated the AI craze we're in right now? ChatGPT, something everyone could use and understand. A few apps on Meta's Quest have gained large followings, but aren't unequivocally mainstream hits.
"There really hasn't been a metaverse-related app that's taken off," said Insider Intelligence Principal Analyst Yory Wurmser. "Horizon Worlds, for instance, has a few hundred thousand users, tops. The apps that have gained a pretty large following are games, such as Beat Saber, or fitness apps, such as Supernatural. Those two genres are where most of the activity on Quests occurs — games especially."
Meta held its Gaming Showcase on Thursday, unveiling a deluge of new titles for the Quest, tying its new offerings to a wave of high-value intellectual property, including "Assassin’s Creed Nexus VR," "Stranger Things VR," and "Ghostbusters: Rise of the Ghost Lord." These showcases are meant to show the breadth and depth of the games you can play on Quest, as the company is trying to both reach as large an audience as possible while hoping that, one of these, will finally be the mega-hit app, said IDC Research Director Ramon Llamas.
"Showcases are just that: an event to announce and present new experiences, apps, and games," he said. "Some of them might see the light of day, others may not, but what I like about it is that there are a variety of titles and game types appealing to different age groups, gaming groups, and numerous other audiences. Glad to see some of these titles coming back for a second or third time too."
To me, the volume of titles at the Gaming Showcase feels like they were throwing things at the wall to see what sticks. Experts say that that take is, well, only sort of fair.
"I think that's legitimate, but gaming is where things actually are sticking," said Wurmser. "So, I think Meta geared today's showcase to build momentum in the area where Quest — and VR generally — has the most traction."
'A clear competitor'
Of course, a hero app won't solve all the problems that VRs have had in gaining traction — but it certainly could, combined with access to other popular games and apps, go a long way.
"It’s important to be known for something, and that also counts for apps," said Llamas. "Having an app that is exclusive to you (like Meta’s Beat Saber) can help, but also important is access to the top tier games available on other gaming platforms."
Now, Apple's entrance into the headset market will, for the first time, threaten Meta's dominance in the space so far — but in a way, for Meta, it's also a gift.
"Apple brings much-needed attention to the market. It has done this with many of the products the company has released since 2007 when the first iPhone came out," said Llamas.
Yes, Apple will likely announce its headset next week, but there are still lots of questions, key among them: What apps will be featured as key to getting the full experience with that Apple headset? That will be something to watch out for Monday, as the ease of use that's historically characterized Apple's devices may color their choices on this front.
"Apple has managed to turn its premium smartphones into mass market goods by virtue of great design and UX," said Wurmser. "If they manage to do that with this headset (unlikely) or ensuing headsets (more likely), it could seriously challenge Meta's VR share."
And it's very likely that soon, VR's first great race heats up.
"At the very least, Meta will have a clear competitor in terms of software and hardware, and Apple will emerge as a threat to Meta’s first-mover advantage," said Llamas. "It also sets up an arms race for applications, and I think this is where things get really interesting because while a headset gets a person’s attention, the software keeps it there."