This article was updated on Jan. 27, 2017, and originally published Aug. 24, 2016.

Virtual reality (VR) is still a very small market, with just 1% of PCs being VR-ready, but that's not stopping many tech companies from investing lots of time and money to bring new VR tech to market. Facebook (NASDAQ:FB), NVIDIA (NASDAQ:NVDA), Sony (NYSE:SONY), and GoPro (NASDAQ:GPRO) are all pursuing VR in their own ways -- and investors should take notice now. 

Image of Sony's Playstation VR headset.

Image source: Sony.

Over the next few years, VR will begin to realize its potential. By next year, there will be an estimated 171 million active VR users, and by 2020, the VR market is expected to grow to $70 billion, according to TrendForce. 

But not all of these virtual-reality companies are good bets. Here's what you should know:

NVIDIA's dominant virtual-reality position

NVIDIA is already the dominant graphics processing unit (GPU) maker right now, with 70.9% of the discrete desktop GPU market share. The company's graphics cards are delivering most of the high-end graphics on both PCs and notebooks, and it's showing no signs of giving up its dominant position.

The company took a huge step into VR last year when it launched is new GTX 1080, 1070, and 1060 graphics cards for notebooks. The cards come within 10% of the performance of comparable desktop graphics cards (an amazing feat) and make any laptop they're in completely VR ready. 

To top it all off, NVIDIA's GPUs are starting to be used in servers that could soon be used to power cloud-based VR systems. That would off-load processor-intense tasks, like motion-sensing cameras, to the cloud instead of running it all from the PC.

Either way, with the company's dominance in both desktop and notebook GPUs and its new VR-ready graphics cards, NVIDIA will continue dominating the hardware gaming industry as it moves toward virtual reality. 

Sony's immediate virtual reality play

Another company with lots of virtual reality potential is Sony. The company began selling its VR bundle -- which includes a game, motion controllers, and a VR headset -- for $499 late last year, or $399 for just the VR headset. The PlayStation VR bundle works with the PlayStation 4, which has already sold more than 53 million units to date.

And there's evidence to suggest that many gamers prefer VR on a console like the PlayStation 4 rather than on PCs. A Gamer Network poll found that more gamers wanted to buy Sony's VR headset than any other VR system.

Sony also has a long list of developers who are already creating VR games for its console -- about 230 at last count. Sony may take some time to ramp up sales for its VR headset, but the company's strong position in the market shouldn't be ignored.

Facebook's long-term bet

Facebook spent $2 billion two years ago to acquire the VR company Oculus. The company's Rift headset went on sale last year for $599, which is at the top of the high-end VR market. That's probably not a bad thing in the long run, but right now it means that it'll be a while before Facebook starts making significant money from its Rift purchase. 

But Facebook is being patient. CEO Mark Zuckerberg has said about VR that, "It's important also to recognize that this is going to grow slowly, like computers and mobile phones when they first arrived." And Oculus's CEO, Palmer Luckey, has said that it'll probably take five to 10 years for virtual reality to truly take off. 

In the meantime, Oculus is partnering with developers to create VR games, and making some of its content, as well. Investors shouldn't expect Oculus to pay off anytime soon, but Facebook is taking the long-term view on VR, and investors would be wise to do the same.

GoPro's virtual reality attempt

Last year, GoPro debuted a cube-shaped rig called the Omni. It holds six of the company's cameras for filming video that can be stitched together for virtual reality.

If you haven't seen them on Facebook or elsewhere, GoPro's 3D videos are truly impressive (check some of them out here). The problem is that I don't think there's much keeping other companies from stealing the Omni's thunder. 

First of all, the rig costs $1,500 by itself. But that price jumps to about $5,000 when you add the six HERO4 Black cameras that are required to film in 3D through the rig. That price point significantly limits the Omni's ability to appeal to the everyday consumer.

Second, there's nothing stopping other companies from creating their own rigs with software that pieces together the videos for a similar VR experience. Of course, GoPro is making the process easy by offering users both the rig, cameras, and editing software to create VR videos. But I still don't see this being much of a hurdle for the competition.

There's certainly VR potential for GoPro, but at this point, I think the company faces a massive problem in getting users to adopt the tech because of its high cost. And while its 3D videos look great, it's still unproven whether or not there are enough people out there who actually want to buy hardware to make their own VR content. 

Each of the companies above are getting serious about virtual reality, and all of them have potential. But when it comes to investors looking for more immediate payoffs in the VR space, I think both Sony and NVIDIA will be the best bets, with GoPro having the least opportunity.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis -- even one of our own -- helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.