Meta continues to pump money into the growing VR gaming segment

Meta continues to pump money into the growing VR gaming segment

Auparavant une exclusivité PlayStation VR, <em>Iron Man VR</em> will arrive in Quest 2 after Meta purchases developer Camouflaj.”/><figcaption class=

Enlarge / Previously a PlayStation VR exclusive, Iron Man VR will come to Quest 2 after Meta purchases developer Camouflaj.

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Meta Connect’s Keynote presentation on Tuesday afternoon spent a lot of time talking about how virtual reality – and the upcoming high-end Quest Pro headset – would help revolutionize the future of work and socializing. But the company has also spent a lot of time talking about the gaming sector which has so far been the primary use case behind the Quest 2 headset’s relative success in the market.

To build on this success, the company today officially announced its recent acquisition of three other major VR game studios:

These recent purchases add to a recent flurry of acquisition spending from Meta Game Studios that already included Beat Games (beat the saber), Ready at Dawn (lonely echo), Sanzaru Games (Asgard’s Wrath), interactive shower (Ahead) and BigBox VR (Population one). In July, the Federal Trade Commission filed an antitrust lawsuit in an attempt to stop Meta from buying Within, the makers of the popular VR fitness app. Supernatural.

Grow, but how fast?

Meta’s extra spending on even more VR developers comes as Quest 2 headset owners appear to be spending more on software than ever before. In total, Meta said today that $1.5 billion has been spent on games and apps on the Quest store since the platform launched in spring 2019. That’s up from $1 billion. dollars in cumulative app revenue the company announced in February, suggesting VR spending is accelerating at a decent pace.

On the other hand, Meta’s 30% share of those sales only represents $450 million in direct revenue over three years. For context, Microsoft recently revealed that it generated $2.9 billion in revenue in a single year of Xbox Game Pass console subscriptions, making the VR gaming market look like a relative decline in the bucket.

Meta’s VR software revenue is still well below the $2 billion Facebook paid for Oculus eight years ago. And that figure doesn’t even take into account the high operating, R&D and acquisition costs the company has incurred since the purchase.

Meta’s “Reality Labs” division (which includes all of its VR business) lost about $10 billion in the past year, according to data from the company’s quarterly tax returns. John Carmack, who served as Oculus’ chief technical officer until 2019 and is still an adviser to the company, said in a podcast interview in August that he had “a stomach ache thinking about so many money spent. But that’s how they demonstrate their commitment to it. …Google goes and cancels all these projects, while Meta really sticks to funding VR and AR even further .”

When you succeed, we all succeed?

<em>The Walking Dead: Saints and Sinners</em> grossed $50 million on Quest VR, proving that at least some titles can find a significant market on the platform.” src=”https://cdn.arstechnica.net/wp-content/uploads/2022/ 10/saints-640×413.jpg” width=”640″ height=”413″ srcset=”https://cdn.arstechnica.net/wp-content/uploads/2022/10/saints.jpg 2x”/><figcaption class=
Enlarge / The Walking Dead: Saints and Sinners grossed $50 million on Quest VR, proving that at least some titles can find a significant market on the platform.

Despite these heavy losses, Meta has always expressed enthusiasm for the number of individual developers who have succeeded with Quest 2 games. In a flurry of statistics, the company revealed that:

  • “About one in three” of Quest 2’s 400 apps “makes millions in revenue.”
  • This includes 55 titles that have grossed over $5 million (more than double the number that hit that mark last year) and 33 titles that have already grossed over $10 million (compared to 22 such titles in february).
  • Near the top of Quest 2’s income pile, The Walking Dead: Saints and Sinners earned $50 million, “almost double its earnings on all other platforms,” ​​Meta said
  • Fast sellers like Resident Evil 4 can generate $2 million in Quest 2 revenue in just 24 hours after launch. Just below, games like Blade and Sorcery: Nomad and Zenith: the last cityearned their first million dollars on Quest in 48 hours and 24 hours, respectively.
  • bonelab set the Quest 2 fast-selling record, earning its first million dollars in “under an hour”.

These are encouraging numbers for a market segment that seemed like a desperately small niche just a few years ago. But Meta (and its app developers) will need to see years of equally rapid revenue growth before the company’s hugely heavy investment in the space is about to pay off.

Elsewhere in his presentation, Meta talked about some upcoming Quest games. Among us VR– a first-person version of the viral social deduction sensation we last saw in April, will finally launch on November 10. And chapter 2 of Walking Dead: Saints and Sinners franchise will show off its New Orleans setting in December.

Xbox Game Pass subscribers will soon be able to access their Xbox Cloud Gaming library through their headset, streaming titles on a huge 2D virtual screen projected in VR.

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