Introducing DB’s VR Ecosystem
As we sit on the eve of the biggest consumer launch in VR history we observe many key trends: 1) the desktop VR pre-order period suggests demand is exceeding expectations, confirmed by Oculus/HTC comments, 2) mobile VR still looks like winning long term mass market play - fracturing into 3 subsectors: Light, Cradle and Dedicated. We could see 50m units in the market in 2017 on GearVR and Google bringing other OEMs into the picture (while Apple remains in stealth mode), 3) the industry is moving towards “fullpresence” on hardware side, with mobile catching up to desktop over few years, but engagement will come down to whether content is compelling. In summary, the pace of innovation we see in VR reminds us of smartphone circa 2007, it’s going to take a few years before the pieces are in place, but we remain hugely bullish. This report is second in our VR series (see first here: LINK) and focuses on more granular details as the 

?industry goes into consumer adoption mode.
Unit Forecast Update – Pre-Orders Look Solid, GearVR To Break Out In 2016
We revise our desktop & console VR unit growth forecast based on granular data including the 13m installed base of VR-ready PCs according to Nvidia, the 37m current PS4 installed base, Steam’s 120m+ PC gamers, and more importantly, by analyzing the content available on each platform at launch (with more announcements coming soon). We now forecast 1m Oculus, 1m HTC, 2.5m Sony and 18m mobile VR users at year-end 2016. Given the 50m PS4 installed base by year end and Sony’s history of successful launches, we currently expect PSVR to have the most units in the market. Longer term, we continue to see mobile VR’s low cost of ownership and rapidly improving UX as the largest opportunity. Samsung is likely to ship 10m+ GearVR in 2016, up from 250k last year, which will cement its early position in mobile. Looking to 2017, mobile VR could hit 50m units quickly as Google (and potentially Apple) brings other OEMs and experiences to the market.

Challenges Remain In 2016 In Quest For Full Presence
Despite our optimism, there are a number of challenges today in the VR space. Full Presence is the sensation of tricking the mind to feeling completely in a new VR world. Few platforms are ready for this today. HTC Vive is arguably the closest hardware system with its motion controllers and Lighthouse tracking system. Touch will close the gap today between Oculus Rift and Vive, but doesn’t ship until 2H16. Mobile VR has lots of hurdles to overcome, but should have position tracking, motion controls and higher frame rates over the next few years. Finally and most importantly, creating content in full presence requires the appropriate storyline, which few have really cracked thus far.

Eoin Treacy's view

Here is a link to the full report. 

Virtual reality is upon us and it has real potential to enhance the gaming experience from day one. Steam/Vive has a committed user base for pc based games and will be among the first to benefit from this evolution. Facebook’s Oculus Rift will be shipping with an Xbox One controller and Samsung’s phone cradle will appear to a wider user base still. 

The online shopping experience, healthcare, exercise, conferences, working remotely, advertising and even tourism are all in the future for virtual reality as it competed for widespread consumer appeal. 

HTC was flirting with bankruptcy in August last year, before positive reviews of the Vive emerged. The share has since jumped 150%, moved back above the 200-day MA last week and through the psychological TWD100 area today. A clear downward dynamic would be required to question potential for additional upside. 



Facebook, Microsoft and Alphabet all remain in reasonably consistent uptrends. 

Nvidia rebounded impressively from the region of the 200-day MA from early February and has developed a short-term overbought condition. Some consolidation is looking likely but a sustained move below the trend mean would be required to question medium-term upside potential.

This article from Gizmag comparing the main systems may also be of interest.