Tech and media groups are stepping up their investment in new virtual reality experiences that are designed for shopping malls and movie theatres, as retailers and cinema chains try to combat the rise of Amazon and Netflix. Consumers have been slower to purchase VR headsets to use at home than many in Silicon Valley had hoped, in part because they require a powerful PC costing several hundred dollars and plenty of space to make the most of the equipment.
Movie chain operators including AMC and IMAX, alongside start-ups such as Dreamscape Immersive and The Void, are hoping to turn VR’s slow start to their advantage, offering consumers richer experiences for little more than the cost of a cinema ticket. “Motion pictures and retail malls are facing a similar challenge: how do you draw customers when they can get things delivered via Amazon or download things via Amazon?” said Walter Parkes, a former Hollywood producer and writer who is now Dreamscape’s co-founder and co-chairman. “The trick is to have vibrant, irreplaceable experiences.”
Utah-based The Void, which has raised tens of millions of dollars in investment from Chinese investor Shanda and Walt Disney, ran a Ghostbusters experience last year in New York. Later this year, in partnership with Disney’s Lucasfilm unit, it plans to offer Star Wars-themed attractions in California and Florida.
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Dreamscape team: chief executive Bruce Vaughn (left to right), co-chairmen Kevin Wall and Walter Parkes and chief operating officer Aaron Grosky © Mike Niemann
Now another Hollywood consortium is backing Dreamscape, which was founded in January by Mr Parkes with co-chair Kevin Wall, a tech investor and producer. Bruce Vaughn, a former executive at Disney’s theme parks division, Imagineering, is the venture’s chief executive.
AMC is leading a $20m funding round for Dreamscape, the two companies announced on Tuesday, with plans to launch VR centres at up to six locations over the next 18 months. AMC’s initial $10m investment values Dreamscape at $150m. The Los Angeles-based start-up had previously raised $11m from investors including Warner Bros, 21st Century Fox, MGM, Westfield and Steven Spielberg. It also counts director Gore Verbinski, composer Hans Zimmer and designer Yves Behar among its advisers.
Rich Gelfond, chief executive of IMAX, which is both an investor in Dreamscape and is piloting its own VR centres in New York and Los Angeles with digital experiences based on films including Star Trek, said location-based VR was showing “some promising signs”. Operations such as The Void, Dreamscape and IMAX VR outfit their customers with full-body motion sensors, as well as a headset and backpack computer, to allow small groups of people to walk around freely in the same physical space together — all while inside VR’s digital world.
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“We are social animals and we consume entertainment socially,” said Mr Parkes. “If you are isolated in virtual space, it will never become a mainstream entertainment form.” Adam Aron, chief executive of AMC, said Dreamscape’s location-based model was a “perfect fit” with its existing network of 1,000 movie theaters. “They are taking VR, which has been in my view an elevated video game experience, and they are turning it into cinematic storytelling,” he said.
VR provided “one more reason for people to go to the theatre”, similar to IMAX screens, bars or reclining seats. We are social animals and we consume entertainment socially. If you are isolated in virtual space, it will never become a mainstream entertainment form WALTER PARKES, DREAMSCAPE Worldwide spending on VR and augmented reality products and services is expected to leap from $11.4bn this year to almost $215bn by 2021, according to research group IDC.
But as developers of VR technology have found it difficult to get their product in front of consumers, headset makers such as Sony and HTC have started dabbling with more arcade-based gaming experiences, especially in Asia, as a way for people to test the technology and drive growth. “The VR arcade scene is growing in Japan,” said Miyu Nishikawa, director of HTC’s VR business unit, with Japanese customers preferring video game consoles over the high-end PCs that best support VR gaming, as well as often having small living spaces.
Andrew House, global chief executive of Sony Interactive Entertainment, is hoping that VR arcades could help to persuade more people to take home its PlayStation VR headset. “I think what is going to drive it is great experience, combined with broadening the opportunities by which people can try it for the first time,” he said in an interview on the sidelines of the Tokyo Game Show last week. Unlike traditional video games, it is difficult for would-be customers to see what VR looks like from a television commercial, he said. “Really, the way to do that is to increase the trial-based opportunity. And if those are monetisable location-based opportunities, all the better.”
Source: Financial Times