PlayStation VR2 Is Selling Well Enough to Keep Sony in the Game | Analysis

Sony’s been smashing expectations with the PlayStation 5, and the console’s accompanying virtual reality headset, the PlayStation VR2, is off to a respectable start in its own right. Given its hefty price tag of $549, the sales Sony is reporting indicates that VR is persevering as a healthy niche market rather than turning into a fading fad.

The device’s performance has big implications beyond Sony and the PlayStation ecosystem: With Apple poised to introduce a questionably pricey mixed reality headset and Meta CEO Mark Zuckerberg reaffirming his company’s commitment to a metaverse bet he’s poured tens of billions of dollars into, the VR world has needed a sign that there’s a healthy business to be found.

Sony recently confirmed that the PS VR2 had managed 600,000 sales in its first six weeks on sale since February, with a little over 400,000 preorders. Against an installed base of somewhere around 40 million PS5s, that’s not too shabby for an expensive peripheral. And that adoption rate exceeds that of Sony’s initial PS VR, indicating that even if the market for the tech hasn’t grown enormousy, the people who liked it the first iteration are here to stay.

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“Sony appears to be accepting the higher upfront cost of the headset rather than hitting the much-desired $299-and-below price point that Oculus had initially successfully achieved and saw huge volumes as a result,” said Anshel Sag, principal analyst at Moor Insights & Strategy, referring to the Meta headset now known as the Quest. “I believe that the PS VR2 will have a much better long tail of sales than the original did.”

PS VR wasn’t a fluke

The early performance of Sony’s second VR headset suggests the PS VR line may be a fixture of the PlayStation brand for the foreseeable future, which provides reassurance for game developers considering whether to bet scarce development resources against it.

“When Sony looks at virtual reality, I think they see more than the bottom line in front of them, which, in some respects, is both unusual and admirable,” said Richard Gardner, CEO of Modulus, which provides technology consulting services to large corporate customers. “I think Sony recognizes that their target market will likely eventually make the transition towards virtual reality, even if that’s not where the market is right now. It is an investment in the future and a commitment to evolving.”

That emphasis on evolution, not revolution, is evident in Sony’s strategy, which bridges the older style of console gaming dubbed “flatscreen” and newer VR gaming. Many developers are crafting flatscreen games for PlayStation and tacking on VR experiences, which means they can tap the large PS5 audience while also catering to the smaller set of PS VR2 users. IO Interactive did it with “Hitman 3” during the PS VR/PS4 era, and Capcom’s doing it for PS VR2 with “Resident Evil 4.” This strategy helps minimize developers’ investment risk and gives Sony more ammo for its VR pushes.

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What’s the ceiling for the VR market?

The numbers for the PS VR 2 suggests Sony is selling about 30,000 a week, said Michael Pachter, managing director at Wedbush Securities: “The slope of the curve is flattening mightily. That curve suggests to me that they might sell 1 million the first year, which I think is pretty close to what people expected.”

He suspected PS VR2 would “never be a big seller.”

“There are a bevy of competitors who are either set to go to market with VR/AR devices, like Apple, or exploring the potential of doing so over the next several months, like the rumored Google/Samsung device,” said Rolf Illenberger, founder and CEO of VRdirect. “All of those companies are probably relieved, if not excited to see these numbers in a struggling economy, especially one that has hit the tech sector hard.” But he thought that the PS VR2 would remain a “niche product within a smallish, niche market.”

Ahead of its time?

Will the PS VR2 crack the mainstream before it’s technologically outdated? For now, it’s at least maintaining a similar path to that of its predecessor, which did well enough to please Sony during the PS4 era. That bodes well for a VR3, though Sony didn’t respond to TheWrap’s request for comment.

With its Quest line, Meta is far and away the VR pack leader with almost 20 million headsets reportedly sold. Yet the PS VR2 has even done well enough to make a dent in its market share. According to IDC, despite AR/VR headset shipments declining overall in the first quarter of 2023, Sony made gains at Meta’s expense.

“Among the top five AR/VR headset makers, Meta continued to lead with 47.8% share although it did lose ground to Sony’s PS VR2, which captured 35.9% share during the quarter,” the firm reported.

The hype around VR has definitely faded. But as research firm Gartner has pointed out, when expectations around a new technology deflate, that’s often the exact point where adoption starts to pick up. The PS VR2 seems to be in that moment.

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