Facebook closing nearly half its Oculus kiosks in Best Buy stores

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Last year, Facebook announced it would push Oculus Rift demo kits in 500 Best Buy stores around the nation. The move was widely seen as key to establishing virtual reality in the consumer market. One of the biggest problems with VR is that it’s impossible to convey in text, images, or video what it’s like to actually wear a headset. On a 2D screen, the output from a VR headset just looks odd and weirdly doubled up (with one image for each eye).

Unfortunately, Facebook’s efforts to bring VR as a demonstrable product to regular users appear to have fallen remarkably flat. Facebook will close 200 of its 500 kiosks, according to Business Insider. Multiple Best Buys have told BI that they went days without a demonstration, while a memo shared with the publication reports that the store closures are being done due to “store performance.”

“We’re making some seasonal changes and prioritizing demos at hundreds of Best Buy locations in larger markets,” Oculus spokesperson Andrea Schubert said. “You can still request Rift demos at hundreds of Best Buy stores in the US and Canada.”

“We still believe the best way to learn about VR is through a live demo,” she continued. “We’re going to find opportunities to do regular events and pop ups in retail locations and local communities throughout the year.”

There are a number of ways to parse these comments, ranging from the dire (an early warning sign that VR adoption isn’t taking off) to the more prosaic explanation that most consumers weren’t aware of the technology and VR’s high prices may be keeping people from even expressing interest in the demos.

The Oculus Rift: Note the cables connecting to the PC. (Future versions may be wirelessly linked, though.)

Demo kiosks are a good way to see an Oculus or HTC Vive (this image is from earlier demos done in 2014).

This year will shed light on which of those scenarios is most likely true. We’ll see more games debut for Oculus Rift, HTC Vive, and PlayStation VR, while the cost of PCs required to play in VR are likely to decline. AMD already partnered with Oculus and CyberPower to offer $ 500 VR systems, but that was a single, particular SKU.

Pushing VR costs lower across the PC ecosystem will require faster CPUs (to some extent) and faster GPUs (to a much larger extent). AMD’s Ryzen should deliver lower-cost products that can keep up with VR workloads, while the GPU refreshes expected from AMD and Nvidia in 2017 should deliver even better top-end performance. It’s not clear yet how either company will improve its midrange products, but even modest clock bumps would deliver a small improvement at equivalent price points. Overall, we expect the price on VR-ready PCs to continue moving downwards after debuting last year at ~$ 1,000. And not for nothing, but Facebook could’ve drummed up more support for VR just by advertising or talking about the product more widely. It’s not even clear how many consumers knew Best Buy stores had VR kiosks, or that this was advertised by either company for any length of time.

If VR succeeds in the mass market, it’ll be because consumers found the technology amazing enough to buy into. But it could take another 1-2 years before we can accurately judge how the market is moving.

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