The first Virtual Reality (VR) experiments were made in the 1950s. At the time, it was to be used to create ‘experience theatres’. The idea was to give a person an opportunity to be a part of the experience rather than view the experience from a third person’s point of view.

About 6 years ago, I had the opportunity to meet the CTO of Technicolor. In my infinite ignorance, I assumed they were a dying company still making film rolls. Hence I started a conversation about the survival of the company. That conversation segued into what they were doing - cutting edge animation and post-production work. At the time, he said, they had done several experiments with VR and what they had learnt was people want to be passive viewers of movies and not a part of it. You want to watch dinosaurs running on the screen, not all around you.

In the intervening 70 years since the first VR experiments, there have been a large number of highly competent companies that have taken a jab at creating or rather monetising this technology and failed spectacularly.

Some Basics

Virtual Reality is an environment that is created completely virtually. Hence you have no connection with physical reality. You are completely cut off. Mark Zuckerberg has rechristened his company meta to promote this vision.

Augmented Reality is basically what it sounds like. In other words, what Terminator would see. When you are provided context for the reality that you are experiencing. You look at a store and you see their google reviews for example. This is the vision that Google followed with Google Glass.

Mixed Reality is where your context switches between Virtual and Augmented reality. This is the vision that Microsoft has with Hololens

man in black jacket holding blue and white plastic cup — Photo by XR Expo on Unsplash

Now all of these companies are well endowed financially. They all have the distribution might to get the product in every hand in the world. After having invested between 5 years to a decade and billions; all of them have little or nothing to show.

A startup would not be given 5 years to show product-market fit. Investors have been rather patient with these companies.

When the iPhone was launched the market fit was obvious in the first quarter. These companies are failing in plain sight and nobody seems to be taking note of it.

The truth of the matter is that apart from gaming, all of these technologies are only great for B2B applications such as remote operations, training, etc. They do not have much of a consumer application at all. What all these companies are attempting to do is try to fit a square peg in a round hole.

The trouble is their misdirection.

Their massive announcements are meant to drive more capital into this segment. Truth be told, almost no investor has any clue what will work and what won’t. But when a technology is touted as the future, many of them have the inclination to invest because they assume that these large companies would also be making investments in building the ecosystem.

The truth is…

Metaverse “meh”: 58% say the idea of a “metaverse” makes them neither scared nor excited for the future. More than three times as many people are scared than excited (32% vs. 7%).
Younger adults (18-34) are far more likely to say the idea of a “metaverse” makes them excited (14%) vs. those 35-64 (5%) or 65+ (3%).
A similar number (60%) say they’re unfamiliar with the idea of a “metaverse, but even among those who are familiar with the metaverse, most (50%) are neither scared nor excited about it, while 35% are more scared and 14% are more excited.
Source: Momentive

The higher number of youngsters excited by VR stands at 14%. This is a very small portion of the market. Even those who know the ins and outs of VR and other reality technologies are not adopting it. Hell, I would be surprised if Mark Zuckerberg himself was adopting VR. He should be conducting all his meetings with cartoons given that he has changed the name of his company to show how much he believes in the concept.

But as with most tech moguls, they want only others to use their technology, not their own.

Gates explained that he and his wife Melinda strictly limited their kids' tech exposure, banning them from owning a cell phone before they turn 14 or whipping out their devices at dinner time.
[…]
"They haven't used it," Jobs responded. "We limit how much technology our kids use at home." The conversation prompted Bilton to dig into the restrictions other tech titans institute at home with their kids. He found a stunning level of strictness was common across many of the best known names in tech.
"My kids accuse me and my wife of being fascists and overly concerned about tech, and they say that none of their friends have the same rules," Wired founder Chris Anderson told Bilton. Evan Williams and his explained that "in lieu of iPads, their two young boys have hundreds of books (yes, physical ones) that they can pick up and read anytime." Many others reported similar rules.
Source: Inc

They know these technologies are an assault on our attention and our minds. I am sure none of the Sackler kids has ever been prescribed OxyContin. Similarly, none of the tech billionaires would allow their own technologies to enter their residences. But they will wax eloquent on the stage about the virtues of the same technologies.

Thankfully when it comes to VR…

Despite the high level of investment by companies around the world, metaverse games are struggling to retain players, according to a new report.
As compiled by Coin Desk, metaverse titles are struggling to provide players with reasons to continue to engage with the game.
Metaverse title Axie Infinity has seen an average daily user drop of 30% to around 107,240. Another title, The Sandbox, has fallen 29% to around 1,180.
“There is currently no organic engagement that retains players in the game, unlike traditional games like Fortnite, GTA, Candy Crush, where players are willing to pay to keep playing,” Blockchain Gaming Analyst analyst DeFi Vader wrote when discussing Axe Infinity.
Source: Video Games Chronicle

Even the one category which is ripe for domination does not seem to be working out in their favour.

Ultimately, it is not about these large companies haemorrhaging their money on stupid and useless technologies that have had no past and will not have a future. It is about the resources - the time, the money, the manpower that they manage to rob away from real problems that need pursuit and solution.

What excites Fadell as an investor today is how business is becoming democratised as more entrepreneurs can access cheap technological tools, easy finance and global markets. “I think that we can widen the universe” of entrepreneurs, he says. What has also changed since the last cleantech boom and bust of 10 to 15 years ago is that governments and consumers are now “screaming” for action on the environment. Carbon border taxes can provide an economic incentive for green investment, too.
He is, however, worried that surging investment in the metaverse will suck energy out of climate tech. “The metaverse is a false choice. It is a diversion of resources. Either you are part of the problem or part of the solution. If you invest in the metaverse you are part of the problem,” he says.
VCs can make money from moving around digital bits, but it is only by moving around physical atoms that we will solve the climate crisis.
Source: Shifted

This is a well-worn playbook. Create something and then hype it up across the world and tell everyone that this is the future. Pull all the research and marketing dollars out of any other parallel technology that could win and then declare victory.

One of the greatest players of this game is Elon Musk. He invested in a company that made battery-powered cars. He bad-mouthed Hydrogen fuel cells for years, painted EVs as the future and robbed Hydrogen Fuel technologies of research dollars and marketing.

When it comes to the business of realities - thanks to the fact nobody trusts Mark - that play will never work.

Learning by Proxy by Vivek Srinivasan

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