It turns out it’s not that hard to explain the metaverse — but people may not be ready for it quite yet. According to data from the research firm NDP Group that was shared with CNBC, sales of VR headsets are surprisingly down year-to-year.
While a 2% decrease in sales might not seem too dire, it marks a serious issue for companies that have invested heavily in the virtual reality world, such as Meta (formerly Facebook). As CNBC notes, overall sales of VR headsets for the entirety of 2022 ($1.1 billion) are roughly equal to what Facebook’s advertising business generates every three days.
This Is the Simplest Way to Explain the MetaverseWe can do it in three words — while some experts provide larger context and clear up some major misperceptions.
As well, the analyst firm CCS Insight suggests worldwide shipments of VR headsets and augmented reality (AR)devices dropped more than 12% year-to-year in 2022.
As to why? Besides some underwhelming metaverse demos shown off by Mark Zuckerberg, you can blame the overall economy, a lack of a “hit” product and a surprise recent price increase for the market-leading VR headset (Meta Quest 2). “The price of the Quest 2 used to be very attractive, right at the sweet spot where the next generation of tech enthusiasts would consider buying one,” says Leo Gebbie, Principal Analyst for Connected Devices at CCS Insight. “The higher price is more than what potential owners of VR devices are willing to pay, which is a problem for a segment seeking growth.”
One ray of hope? Apple’s rumored entry into the VR market next year. “If one company has the ability to transform the VR market overnight, it’s Apple,” said Gebbie. “With its hugely loyal fanbase, many of whom are comfortable with spending large amounts of money on technology, if Apple was to launch a headset we expect that it would perform very well.”
Or, maybe just blame the bulky headsets themselves. CCS Insight predicts improved VR sales starting in 2024, supported by “launches of consumer smart glasses.”
Thanks for reading InsideHook. Sign up for our daily newsletter and be in the know.