Many brands were once banking on virtual reality as the core driver towards the metaverse future, but stats (and profit losses) are now showing that products like VR headsets were not the surefire gamer add-on they hoped. In fact, Mark Zuckerberg—driver of the term “metaverse” as he rebranded Facebook to Meta—is being warned to put the metaverse and his push for teens to join Horizon Worlds (their not so successful metaverse platform) to rest. Reality Labs, the division housing metaverse, virtual reality, and augmented reality projects, “reported $13.7 billion in operating losses for Reality Labs for 2022, more than the already jaw-dropping $10.2 billion it sunk into the division in 2021.”Now, as the prices of Meta Quest Pro VR headsets drop in what appears to be an effort to reach more (read: young) consumers, some argue Zuckerberg has officially “buried the metaverse.”
But gaming in other metaverses is strong as ever, as YPulse data has shown (and we’ll explore again in our upcoming Where is the Metaverse? trend report). The success of virtual world gaming through platforms like Roblox and Fortnite highlights what some brands may not have recognized: virtual worlds do not require virtual reality. So, for those wondering if it’s time to cash out on VR tech, our data shows its ever-predicted boom is not coming any time soon, as evidenced by its consistently low ownership amongst Gen Z and Millennials:
VR headsets have not gotten more popular with time
YPulse data shows VR headset ownership has always been low amongst Gen Z and Millennials, and this year, only 11% of young consumers own a VR headset, a number that has changed very little in the past five years. Even as brands have amped up their metaverse experiences, the drive to own VR tech remains low. While the majority say they are interested in using VR headsets for gaming, there’s a decrease amongst Gen Z and Millennials who would prefer to use VR headsets over consoles and mobile devices since 2022; last year, 48% of young consumers were wanting these devices to game more than others, and now only 39% say they’d prefer them. Perhaps this is because virtual worlds are thriving without them, and any metaverse game they want to play can feel immersive without full (headset-needed) immersion.
Meta says they’re not giving up on AR and VR, though; TechCrunch reports “Meta plans to launch a next-generation consumer headset later in 2023,” and that Apple may be on their way to doing the same. But attention is shifting toward a new tech these days, so VR headsets may fall to the backburner as their sales remain stagnant…
Everyone is thinking about AI instead, but they shouldn’t forget about gaming
In light of these losses, Zuckerberg, and many others, have turned their focus toward the booming artificial intelligence trend. According to a letter to staff, Meta plans to make their “single largest investment” building AI into all of their products. And after a year rife with metaverse activations, we see tons of brands who also appear to be ditching gaming for AI integrations (and we did predict AI would be the trend to follow in 2023). However, that’s not to say they should, as YPulse data shows gaming will continue to be influential over the affinity of young consumers—Gen Z especially. Because while VR headsets are clearly not their virtual world must-have, Gen Z is still spending nearly as much time gaming as they are on traditional media like television, and many of their top favorite video games are the metaverses they’re actually tapping into.
