It has been almost two years since the first high-end VR headsets hit the shelves, generating excitement and headlines insisting that the future is here. Now, as we reach the end of 2017, those headlines couldn’t be more different. Barely a week goes by without another article detailing VR’s demise, a VR studio’s closure, or explaining why CCP pulling out of VR development shows the market isn’t viable for many. As the CEO of a big VR-focused development studio, these reports have not made things easier. But we’ve still found success, and the market can support your success too.

If you move past the deluge of negativity and look at the numbers, you’ll see that VR is quietly and confidently finding its feet. Headset sales may have wobbled earlier in 2017, but since September they have found their stride following price drops for the Rift and Vive, and PSVR stock hitting shelves in much greater numbers following increased supply. Yes, there is clearly a long way to go, and “mass market VR” is still years away; but as a VR developer, I’m encouraged.

So, for those developers who believe in VR as we do, here are some tips for staying commercially competitive as VR continues to mature:

Size matters

Whether that’s the size of your studio, or the size of your game, as a developer, you should be thinking of size at every turn. For instance, you need to be smart about the genre and budget of your VR games. The market just isn’t big enough to justify budgets of more than a million dollars without funding support from headset manufacturers. So, rather than making the big VR game of your dreams, keep that on hold for a few years, and find a concept that is innovative, is in a genre that feels commercial, and can be achieved on a sensible budget.

This last part is particularly important – I have seen many great VR games fail to get anywhere near break-even because they were just too expensive and too ambitious, and the market simply isn’t there yet. We did this with our first high-end VR title, The Assembly. The budget was too large (over $1.5 million) and it’ll take longer than hoped for us to break even on it.

The same principle holds true for how you develop a game. Consider avoiding linear games where the player passes through lots of geometry that they only see once. Think about repeatability and reusing assets and gameplay mechanics in smart ways, as we did with our upcoming title Shooty Fruity, to make the most of your development budget. In addition, adapt your game concepts by reacting to the market changes and by analyzing data. For example, The Assembly initially launched without motion control (this was back in the days before Oculus Touch launched!). We added motion control because of customer feedback, and this has helped long-term sales of the game.

Incidentally, we’re finding that long-term sales on our VR games are significantly higher than we expected, so it’s well worth pushing this area, running promotions and getting into seasonal sales. We’ve now launched seven VR games and experiences and we’re using data from those games to help us focus in on what works and avoid what doesn’t. Our new game, Shooty Fruity, combines many of the lessons that we have learnt, and hopefully we will see this reflected in its popularity when it launches just before Christmas.

Diversify for growth

While VR is still a relatively small market, you may want to balance your studio’s workload and look at doing funded projects alongside self-funded games. Step back, look at your team’s strengths and weaknesses, and then leverage the skills of your team to generate revenue that will help support your own projects. Think about working with other companies to co-develop/co-fund your games, and carefully explore all the different areas of VR. Some of you may find opportunities in the engineering space, others in the design market.

Here at nDreams, we’ve just completed an ambitious VR arcade title for a leading company and have just undertaken a big project in the social VR space with an entertainment giant. This gives us some additional revenue streams, broadens our skills as a studio, and builds strong relationships with some truly great partners. There are many other areas of VR opening up, so look for projects that suit your team, enable innovation, and generate revenue to support your original games.

Think about the kind of people you hire very carefully. The importance of getting the right people in the right roles can’t be overstated, and I can tell you from experience how much of a positive impact the right people can make. If you’re going to be doing funded work alongside your own projects, make sure you have a healthy balance of specialists and generalists, and that you’re able to use the freelance job market wisely to hire talented people during peaks, and scale down if there is a lull between projects. Work with local colleges and universities to meet graduates and make sure you have a healthy flow of new talent coming into the studio.

VR’s not dead, it’s just taking a nap

Finally, don’t let the doom-mongers get you down. After the huge amount of hype about VR prior to launch, there was bound to be a backlash until headset technology improves, costs come down, and quality experiences emerge. Whilst the market has been slower than many expected, we’re seeing strong indications that it is starting to grow, boosted by those recent price drops, new headsets entering the market – hello Microsoft MR! – and now blockbuster IPs like Skyrim and L.A. Noire entering the market backed by TV ad campaigns.

At nDreams, we’ve already sold 300,000 VR games and generated $3.5 million in VR revenue. I’m proud of this start, and I hope these figures will give you confidence as a developer that there is already a viable VR market out there, and that the excitement that so many of us have about VR is justified. Just make sure you’re smart and sensible in the meantime. To paraphrase Mark Twain, “The reports of [VR’s] death are greatly exaggerated”.

Above: Patrick O’Luanaigh

Patrick O’Luanaigh is the founder and CEO of nDreams, a fast-growing games developer and publisher focused on VR games/experiences.

 

 

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