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Nintendo of America CEO: VR isn’t ready for mainstream adoption

Virtual reality was a major topic at E3 this year, thanks to PC gaming’s renewed spotlight, Sony’s upcoming PlayStation VR, and Microsoft talking up VR capabilities as part of Project Scorpio. Nintendo of America’s CEO Reggie Fils-Aime isn’t interested in virtual reality, however — at least not yet.

“In my judgment, I think VR is a bit further out there for mainstream, mass market applications and applications that consumers can invest a lot of time in versus short snacks of entertainment,” Fils-Aime told Bloomberg.

“For us, we want to make sure that technology is mainstream,” Fils-Aime continued. “We want to make sure the technology represents strong value to the consumer… So the way we look at VR or even AR… for us the technology has to be at a point where it can be mainstream, and then it takes content creating companies like us to really make things that the consumer wants to experience, that they want to jump into the particular technology.”

VR has generated tremendous hype and optimism in the PC space and major companies like Sony and Microsoft are clearly angling to position themselves to take advantage of it — but when Fils-Aime talks about waiting for the technology to mature before taking a serious bet on it, he’s arguably making a smart business move.

Fils-Aime’s comments may not be particularly popular, but they’re probably accurate. AMD is publicly focused on bringing good VR performance to lower price points, while Nvidia’s recent GPU launches have focused more on improving VR performance at the top of the stack. Even if AMD’s RX 480 is a top-notch VR performer, however, it’s still a $200 GPU on top of a $600 – $800 headset purchase (though the Vive does ship with motion controls). Either way, if you need a GPU upgrade, VR is anything but cheap. Even Sony’s PlayStation VR, which is currently the cheapest mainstream solution, will set you back over $500 if you don’t have any of the required peripherals. That’s in addition to the cost of the PS4 itself, which will run you $350.

The high cost of buy-in is going to keep VR confined to a specific elite segment of the market for the time being, and that, in turn, is going to shape how content rolls out. Even if we were to assume that VR would roll out as quickly as 3D accelerated graphics did in the late 1990s, we’re looking at a ramp-up period of several years. While we typically treat game history as though the entire industry converted to 3D acceleration after getting a good look at GLQuake, the truth is much more nuanced: While FPS games moved to 3D acceleration fairly quickly, thanks in part to strong support from id-based engines, other games took much longer. Classic titles like Fallout, Fallout 2, Baldur’s Gate, Age of Empires, Sim City 3000, and dozens of others either didn’t use 3D acceleration at all or provided it as a minimally-improved afterthought on classic software rendering. It took roughly four years for 3D gaming to truly go mainstream.

Sony clearly hopes to get an early leg into the VR business and become the go-to company associated with VR content. Microsoft seems to biding its time, but planning to enter the market by 2017, which may also allow it to hit lower price points and offer more attractive hardware. Nintendo, which already has one “reinvented” console in the works with its NX, may want to wait and see how the market shakes out for that platform before diving into something else, particularly given how badly the company got burned in including 3D capabilities in the Nintendo 3DS.

At that time, all market research and analyst projections pointed to 3D as the “Next Big Thing” — and those projections turned out to be laughably off-base. While the 3DS has become a well-established platform, it never came close to matching the meteoric success of the Nintendo DS. The company’s decision to play it a bit safer this time around makes sense given the problems it had in the 3D market.

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